The House Ways and Means Committee plans to propose significant increases in endowment excise taxes for private colleges, potentially raising rates from 1.4% to as high as 21%. This shift would apply progressively based on endowment value per student, with institutions having higher endowments facing steeper taxes. This move forms part of broader GOP reconciliation efforts aimed at cutting federal spending. There are suggestions that the tax hikes serve as punishment for colleges perceived as overly progressive. Education leaders have expressed concern over these impending changes.
"Seven years ago, the Trump tax cuts sparked an economic boom and provided needed relief to working families," committee chairman Rep. Jason Smith, a Missouri Republican, said in a Friday statement.
Republicans are preparing to move forward with endowment tax increases as part of a broader effort known as reconciliation to cut billions in federal spending and pay for President Donald Trump's priorities.
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