Nov 7, 2017 - Politics & Policy

The GOP tax plan could lead to a brain drain

Illustration: Rebecca Zisser / Axios

Graduate students and their professors say their careers and programs are threatened by a provision of the House Republican tax bill that proposes tens of thousands of dollars in higher income taxes on American doctoral students.

Why it matters: The legislation, following a series of threats by the Trump administration that could reduce the number of foreign Ph.D students and their ability to stay in the country after graduation, could be another strike at U.S. dominance of global research and invention. Claus Wilke, chairman of Integrative Biology at University of Texas at Austin, said that should the proposal become law, he "could not in good conscience recommend a Ph.D. to anybody unless they were so rich they didn't care."

"I would tell them to see if somebody can offer you a slot in Canada or Europe where they don't make you pay for your Ph.D," Wilke said.

What the bill says: Currently, U.S. tax law exempts tuition that is effectively provided for free to Ph.D. and other graduate students. The proposal would lift that exemption, making graduate students liable for their tuition, which would be taxed as income.

  • For example, David Walsh, a fourth-year Ph.D. student in history at Princeton, tells Axios that he receives a $32,500 stipend every year, while grants cover his $49,000 tuition.
  • Under the GOP bill, his income would rise to roughly $81,000. After new deductions also included in the tax proposal, his taxes would be around $10,000 a year, he figures.
  • But that is about four times his $2,700 tax bill last year.
  • Walsh said he will not have to drop out because the new law would only take effect in 2018-2019, and "I have a partner who has a full-time job." But "there are plenty of others who aren't so lucky," he said.

"From what I can tell, this plan would fundamentally change the political economy of STEM research, which is an odd choice to make, at least from my perspective," Walsh said.

The House Ways and Means Committee is working on amendments to the tax bill this week, and it's likely to change. But as of last night, nothing altered the change to tax law affecting graduate students.

Heather Gillette, a Ph.D. student in biology at Northern Arizona University, tweeted, "My stipend is $20,000 at a state university. I also have two small kids. This tax plan would effectively remove me from academia."

Jeffrey Melnick, a professor of American Studies at the University of Massachusetts, tweeted that he directs a small master's degree program. "This will kill it," he wrote.

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