How Republicans’ Endowment Tax Will Hurt Higher Education – The Nation Fund for Independent Journalism

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News > How Republicans’ Endowment Tax Will Hurt Higher Education

July 8, 2025

How Republicans’ Endowment Tax Will Hurt Higher Education

By Nic Wong

As the Trump administration escalates its campaign to reshape education, a provision in the “Big Beautiful Bill” will raise the tax on select private colleges’ endowments.

Owen Dahlkamp

Donald Trump pauses in the Cross Hall to listen to the band at the conclusion of the “One, Big, Beautiful” event at the White House. (Chip Somodevilla / Getty)

When President Trump first signed a bill in 2017 eliminating the tax-exempt status enjoyed by many private university endowments, Representative Kevin Brady—the key congressional Republican overseeing the tax code rewrite as chairman of the powerful Ways and Means Committee—said the goal of the new tax was “pretty simple: It encourages colleges to use their major endowments to lower the cost of education.”

In the face of a further tax increase on a small subset of private colleges in the United States, the GOP’s rationale has shifted. Brady’s successor, Representative Jason Smith, has pitched the increased levies as a way to hold “elite, woke universities and nonprofits accountable.”

Read the full article here.

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