GOP Tax Plan Raises Concerns for Students

Congress is beginning work on a compromise between the two separate tax plans passed by the House and Senate.

Graduate students across the country have expressed concern at the potential impact of the House tax plan on graduate student finances.

Last week, New School students gathered in Union Square to protest the House tax bill, which would raise taxes for some graduate students. Students from SENS-UAW, The New School’s newly formed student worker union, joined with peers from NYU, Columbia and CUNY.

Academics cycled through protest chants across from the park’s Holiday Market, occasionally drawing the attention of shoppers.

“From Columbia to NYU, our labor isn’t free. From The New School to CUNY, stop the GOP,” protesters chanted.

Speakers, some reading from prepared comments, took turns speaking from a megaphone. Rachel Chapman, a PhD student at CUNY’s Graduate Center, told the crowd that the bill is a “violent attack” on the working class.

Across the country, students at more than 40 universities staged walkouts and rallies in protest of the plan.

Universities frequently compensate graduate students with tuition waivers and stipends. Tuition waivers can be full or partial, and are not taxable income. Stipends are taxed.

The House tax plan would repeal Sec. 117(d)(5) of the current tax code, which prevents tuition waivers from counting as taxable income. Currently, if a PhD student receives a waiver for full tuition of $37,000 dollars and a stipend of $20,000, they only pay taxes on the $20,000. The House tax plan would have the student pay taxes on the total, $57,000.

Republicans in the House and the Senate have passed separate tax plans. The version of H.R. 1: Tax Cuts and Jobs Act passed in the Senate does not affect tuition waivers for graduate students. The House passed their tax plan on Nov. 16. The Senate passed their plan early Saturday morning, despite outrage from legislators who were given the 479-page bill mere hours before the vote took place. The two chambers will now work to reconcile differences between the two plans. According to Vox, Republican lawmakers hope to deliver a bill to President Trump by the end of the year.

Of New York’s 27 congressional representatives (18 Democrats and 9 Republicans), 23 voted against the House plan. Both New York senators, Chuck Schumer (D) and Kirsten Gillibrand (D) voted against the Senate bill.

According to the NSSR website, about half of incoming PhD students in 2017 received a fellowship. Srishti Yadav, a PhD candidate in economics at NSSR and a member of the SENS-UAW bargaining committee, said that The New School offers significantly less financial aid for graduate students than other universities.

Yadav said that many schools provide full tuition waivers and a stipend to all students they enroll in PhD programs. “The New School is different because it offers this full financial support, which is a waiver and a stipend, to a very small number of students. In my department, I know there are only two incoming PhD students every year who get this particular package,” she said.

In a statement to The New School Free Press, a university spokesperson said, “The New School, like all American universities, is concerned about the potential implications of the proposed tax legislation for our students. We are carefully studying the issue and are following the developments closely to understand how this bill might affect our university and our students. We are also taking guidance from organizations such as NACUBO and others who are advocating for higher education and bringing our concerns to Capitol Hill.”

The university declined to provide information about graduate student compensation.

Yadav and Chandler Gandy, an undergraduate student in SENS-UAW, both said that the school has not provided any response to the tax plan.

Jonas Algers, a first year student studying economics at NSSR, held up a banner for SENS-UAW at the rally. “We hope to show [the administration] that this is an important issue and they have to do something. We want to show politicians that we actually care about this really important issue for grad students,” Algers said.

University administration has not made any public comment on the proposed tax plan.

Yadav said that SENS-UAW had not yet brought discussion of the tax bill into bargaining with the university. “We’re still looking at the way that other schools are coping with this and trying to create a strategy around it,” she said. Given that stipends and wages are already taxed, “I find it difficult to see, at the school level, what can be done,” Yadav said.


Additional reporting by Ryanne Salzano / Photo by Anna Del Savio

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Anna is the Features Editor for the Free Press. She is a senior at Lang, majoring in Journalism + Design and minoring in Politics.

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