Science Groups Urge House to Reject Tax Changes That Hit Graduate Students

House Bill Will Drive Fewer Students to Seek Advanced Degrees, Hurt Economy
Provisions in the House tax measure will make earning graduate degrees less affordable for students, including those seeking advanced degrees in science, technology, engineering and math at institutions such as the University of Michigan. | University of Michigan School for Environment and Sustainability/Flickr (CC BY 2.0)

Scientific and engineering organizations are pressing House leaders of both parties to reject provisions in the pending tax overhaul measure that would eliminate tax benefits that serve to lighten the cost of pursuing advanced degrees in higher education.

In a Nov. 15 letter to Speaker Paul Ryan, R-Wis., and Minority Leader Nancy Pelosi, D-Calif., a broad array of scientific and engineering societies called on House leaders to drop provisions in the tax bill (H.R. 1) that would eliminate tax credits, known as the Lifetime Learning Credit and the Hope Scholarship Credit, that alleviate the financial strain of higher education by providing a dollar-for-dollar reduction in the income tax liability of eligible students.  

Signatories representing millions of scientists, mathematicians and engineers also appealed to House leaders to preserve existing tax benefits such as the student loan interest deduction, which lowers taxable income, and educational assistance programs such as tax-free employer tuition reimbursement programs.

“Repealing the very provisions that allow graduate students to continue to study in critical STEM fields means that we will be shutting the door on new opportunities for discovery, exploration and innovation,” the letter stated. It was organized by the American Association for the Advancement of Science and signed by 45 scientific and engineering societies.

The House Ways and Means Committee approved its version of the tax bill on Nov. 9, setting the stage for House consideration and a vote on Nov. 16. The Senate also has begun work on its version. | Roman Burleson/House Ways and Means Committee

Proponents of the tax bill have said the measure will boost the U.S. economy, but the letter noted that eliminating tax provisions that encourage students to seek advanced degrees will only blunt economic growth. “By making advanced education less affordable it is likely to drive some students away from seeking higher education. Because a majority of graduate students are in the key areas of science, technology, engineering and math, these provisions will have an outsized impact in the sciences,” the letter said.

“U.S. scientific and technological ingenuity has helped to make our nation one of the most innovative in the world and generated tremendous economic benefit to our country,” the letter said. “This inventive spirit starts with people and ideas – and it is our higher-education system that has fostered the development of inventors, entrepreneurs, Nobel Laureates and business leaders.”

The proposed tax provisions have attracted vocal opposition from graduate students on social media and encouraged the scientific community to reach out to their representatives in Congress. AAAS CEO Rush Holt voiced his concern about the tax bill’s provisions in a Nov. 7 letter to the House Ways and Means Committee.

Slated for elimination under the bill is the Lifetime Learning Credit, which allows eligible students enrolled in certain institutions to claim a tax reduction of up to $2,000 each tax year to offset tuition and related expenses for undergraduate, graduate and professional degree courses. Under current law, there is no limit on the number of years those eligible can claim the credit.

The Hope Scholarship Credit – also marked for elimination – provides eligible taxpayers a credit of up to $2,500 for each student, each year, to offset qualified tuition and related expenses paid for the first four years of a postsecondary education.

The first test case for the 447-page measure is slated to come on Thursday, the day House leaders scheduled to hold a floor vote on the bill itself. The leadership could delay the vote, particularly if a whip count comes up short.

[Associated image: University of Michigan School for Environment and Sustainability/Flickr (CC BY 2.0)]