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Paxson denounces tax plan in community-wide email

University president among educators to mobilize against proposed federal legislation

President Christina Paxson P’19 outlined the University’s response to the GOP tax plan in a community-wide email Monday morning, criticizing the bill and explaining its negative impacts on the University.

She wrote that the University has made substantial efforts to address “a number of alarming provisions related to higher education” and aspects of the bill that have “potential financial implications for members of our community.”

The bill, entitled “Tax Cuts and Jobs Act,” includes sections that would prove detrimental to the University, such as sections that tax the endowment, she wrote.

Paxson wrote that elements of the bill “adversely affect efforts to make higher education affordable and accessible” and would decrease the University’s ability to fund expensive research efforts.

The bill, passed by the House of Representatives, is currently under debate in the Senate. According to Paxson’s email, some aspects of the bill that would be especially harmful to universities have been eliminated from the Senate version. She attributed this to the “advocacy of thousands of students, faculty, staff members and alumni.”

However, Paxson emphasized that detrimental sections of the bill remain, including a 1.4 percent tax on the net return on the endowments of private universities that have a value of $100,000 or more per student. This tax would cost the University between approximately $3.3 million and $6.6 million each year, she wrote, and “would set an alarming precedent for the tax treatment of nonprofit colleges and universities.”

She also added that though some damaging sections from the House bill were removed in the Senate version, they could still end up in the final bill.

Harvard’s Provost Alan Garber wrote a similar letter to the Harvard community, in which he outlined concerns over the bill’s potential impact, according to the Harvard Crimson. He wrote that the section of the bill that taxes endowments would cost Harvard approximately $43 million next year.

The presidents of the University of Michigan and Ohio State University published a joint column denouncing the bill. They wrote that the legislation “contains provisions that would make it harder for students to earn a college degree at a time in which the value of higher education has never been greater.”

In closing, Paxson emphasized that she had met with government representatives from Rhode Island to communicate the University’s stance, and is working alongside the University’s Government Relations Working Group to push for reforms to the final bill.

“I am heartened by the efforts of our Corporation members, alumni and friends who have expressed their concerns to Congress as well,” Paxson wrote. “As Congress continues to consider this legislation, Brown’s senior leaders will provide updates on developments that would have a negative impact on students, faculty and staff or impede our ability to fulfill our mission.”



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