Higher Taxes on Wealthy Universities That Increase Student Costs
This bill significantly increases the excise tax rate on the investment income (endowments) of wealthy private universities. Institutions that raise their net tuition price faster than inflation will face a much higher penalty tax rate (20%). The goal is to pressure these schools to make higher education more affordable for students and increase their financial accountability.
Key points
The base excise tax rate on university endowment investment income increases sharply from 1.4% to 10%.
Universities raising their net price for students faster than the rate of inflation will be penalized with a 20% tax rate.
More private institutions will be subject to this tax, as the minimum endowment size threshold per student is lowered from $500,000 to $250,000.
Expired
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