President Davis comments on endowment tax in Chronicle of Higher Ed

Furman University President Elizabeth Davis commented in a Chronicle of Higher Education article about college-endowment taxes and the Trump administration’s possible plans to expand them.

The existing law calls for taxing private colleges’ endowments at a rate of 1.4 percent when endowments amount to $500,000 or more per full-time equivalent (FTE) student. Expanding the tax could cost colleges that meet the threshold a lot more money as legislation has been introduced that would tax colleges’ investment income by 35 percent.

Davis said the current tax is one the university could bear, but double-digit, multi-million-dollar rates would conflict with the university’s values such as retaining small class sizes and offering stipends for internships. The ability to extend enough financial aid to those with modest means would also be impacted.