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Angela N. / Flickr CC

House Republicans have included a provision in their tax plan that could hit the pocketbooks of private universities with large endowments, such as Harvard, Stanford and Yale.

The new rule says that private colleges and universities with at least 500 fulltime students would be required to pay a 1.4% excise tax on annual investment income, so long as total market value is more than $100,000 per student.

For context:

  • Harvard's current endowment is $32 billion, and has around 22,000 undergraduate and graduate students. That works out to over $1.4 million per student.
  • Stanford's endowment is over $22 billion and has around 16,300 students. That works out to $1.37 million per student.
  • Yale's endowment is $25 billion and has around 12,300 students. That works out to over $2 million per student.

The bill does allow schools to subtract assets that are used directly for education, although that wouldn't be nearly enough to exempt the aforementioned schools nor their many peers.

Bottom line: Many private university endowments will need to adjust for the 1.4% tax, possibly resulting in reduced investment activity.

Go deeper

Trump's coronavirus adviser Scott Atlas resigns

Photo: Nicholas Kamm/AFP via Getty

Scott Atlas, a controversial member of the White House coronavirus task force, handed in his resignation on Monday, according to three administration officials who discussed Atlas' resignation with Axios.

Why it matters: President Trump brought in Atlas as a counterpoint to NIAID director Anthony Fauci, whose warnings about the pandemic were dismissed by the Trump administration. With Trump now fixated on election fraud conspiracy theories, Atlas' detail comes to a natural end.

Dave Lawler, author of World
2 hours ago - World

Assassination in Iran sets stage for tense final 50 days of Trump

The funeral ceremony in Tehran. Photo: Iranian Defense Ministry via Getty

Iranian leaders are weighing their response to the assassination of Mohsen Fakhrizadeh, known as the father of Iran’s military nuclear program, who was given a state funeral Monday in Tehran.

The big picture: Iran has accused Israel of carrying out Friday’s attack, but senior leaders have suggested that they’ll choose patience over an immediate escalation that could play into the hands of the Israelis and the outgoing Trump administration.

Updated 3 hours ago - Politics & Policy

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Illustration: Sarah Grillo/Axios

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