Illustration by Maytal Bach
The GOP tax plan that just passed on November 30, and faces final vote before the end of the year, cuts tax breaks for graduate students, which is a big mistake. Removing the tax breaks that students and educators benefit from will create poorer citizens that are less able to pay back their debt and less able to drive the economy forward. These new taxes could crush scholars, educators, and our government alike.
The House GOP tax bill would tax the value of college tuition benefits. Businesses and middle income families would be getting a $1.5 trillion tax cut, but the tax breaks that currently benefit undergraduates, graduates, and campus employees would be eliminated.
The increase in taxes could be harsh for some and drastic for others. The tuition that universities waive for doctoral students in exchange for working on campus would be considered taxable income under the new tax bill, despite those students not actually making any money. In 2015, more than twelve million people paid interest on student loans, a tax deductible transaction, which made it possible for students to take out even more loans to pay for their new taxes. Under the new tax bill, the interest on student loans would no longer be tax deductible. This would result in limited access to higher education for everyone, both by making it harder for students to pay for school but also by making it more expensive for people to teach students.
This new tax bill would only end up hurting America. Why do you think all of those tax cuts for students existed in the first place? The government needs college-educated people, as they are the citizens with the highest incomes and drive our economy ahead. Because of this, education is essential for democratic governments, and encouraging people to go to college is something the government should be, and until recently was, doing.
The new tax bill would make the current government look good by cutting taxes for most people, but in the long run is likely to cause more debt because less citizens would be going to college, and more people would make less money. Peter McPherson, president of the Association of Public and Land-grant Universities, said in a statement that the GOP bill “Would have deeply negative consequences for access to higher education … and the highly skilled workforce that is needed to propel our nation’s economy forward.” This tax plan is a short-term solution that can only add to our nation’s debt despite cutting tax breaks.
The new GOP tax plan is faulty because it removes the former tax breaks that students and educators benefited from, and would ultimately end up hurting Americans more than it would help in the long run.