Last month, the House of Representatives passed its tax reform bill, the Tax Cuts and Jobs Act. Clearing this first legislative hurdle presents an imminent threat to the lives of roughly 145,000 graduate students and could cripple the future of scientific research and innovation in the United States.
As doctoral students in the biomedical sciences at Johns Hopkins University, we receive a living stipend of roughly $30,000 as well as a tuition waiver in exchange for the research and teaching we perform. While we currently pay taxes on our stipends, the tuition waiver is not considered taxable income because none of that money actually ends up in our pockets. The House tax bill would classify this tuition waiver as taxable income. At Hopkins, graduate tuition exceeds $50,000; if this sum were also taxed, the effective tax rate on our stipend would more than quadruple and exceed the tax rate paid by people earning in excess of $500,000 a year. While certain institutions (including Johns Hopkins) can shield their students from this attack, many students will face a tough decision: either take an unexpected and severe pay cut or abandon their doctoral education.
Unfortunately, a tax on the tuition waiver is only the first of many provisions that collectively harm graduate students. The House bill also eliminates the student loan interest deduction, removes the Lifetime Learning Credit, and imposes an excise tax on university endowments. Taken together, these measures compound the burden on students and educators across America.
When we entered graduate school, we accepted that we would sacrifice potentially higher-paying jobs in order to pursue the questions and problems that we are passionate about. This passion drives us to work long hours improving our collective understanding of the world and discovering new tools and technology that benefit all of humanity. Though we are willing to give the energy of our young adult lives to these pursuits, we also need to care for our families and our futures. Our decisions to pursue the opportunities afforded by graduate education are influenced by our individual privileges as well as familial, institutional, and social support. Students who begin with less navigate a more delicate balance between their pasts and futures than those who can rely upon dependable support. The Tax Cuts and Jobs Act will disproportionately burden those who begin with less, subsequently exacerbating the racial and socioeconomic inequalities already present throughout our nation. This tax bill would make higher education financially challenging for all but the wealthiest of students. These new taxes run counter to the ideal of meritocracy at the heart of science and America.
The resulting brain drain stemming from this financial barrier to entry will have long-lasting and far-reaching consequences for research and our country. As current and former graduate students, the five of us are conducting research on a wide variety of topics, including: the molecular mechanisms underpinning premature aging; how bacteria affect mosquito transmission of viruses and parasites; how neurons connect with one another in the cortex; the structure and function of a cancer-causing biological pathway; and, how the brain predicts the sensory consequences of movement.
Our ability to work on these important scientific problems would be stymied by this tax plan. According to a 2016 poll conducted by the nonprofit science policy group, Research!America, a majority of Americans agree that “basic scientific research that advances the frontiers of knowledge is necessary”. Graduate student researchers are an indispensable force that drives both basic and applied scientific innovation. The research we conduct also spurs economic growth; every dollar invested in National Institutes of Health research funding produces $2.21 in goods and services within just one year.
The amount of revenue gained from taxing graduate students is a pittance to the federal government, but will be keenly felt by those affected. In the long-term, scientific progress will be stalled, economic growth hampered, and new cures for diseases delayed. The costs to students, science, and society are far too high to justify passing the Tax Cuts and Jobs Act.
An amendment to the bill to remove the harmful provisions on higher education was made prior to the House vote on the tax reform bill. However, this amendment was voted down along party lines. Protecting the values of higher education and our nation’s future should not be a partisan issue.