The Republican tax plan inching closer to reality seems hellbent on screwing anyone not rich enough to afford a private jet. That includes graduate students.
The vast majority of PhD students in STEM fields receive a waiver for tuition. These can range as high as $50,000 at private institutions, or for out-of-state students at state schools. In addition, most PhD students receive a stipend of around $25,000 per year (though some receive considerably less). Some Masters-levels students also have their fees waived, and a select few receive a stipend as well.
The stipend is taxed as income, but the tuition waiver currently isn’t. Republicans are now trying to change that.
On Thursday, without a single Democrat vote, the House passed a sweeping tax bill that would wipe out the tax exemption for tuition waivers. If the Senate passes its own version of the bill and reconciles it with the House to include the new tuition tax, students would be on the hook for paying taxes on tuition as well as on their stipends. That would saddle students, many of whom are barely scraping by, with a staggering tax burden.
Earther reached out to more than a dozen students, recent graduates and faculty members working in the Earth and environmental sciences.
Their stories were all unique, but there was overwhelming consensus that signing the tax plan into law would create pain for students and usher in an era of declining U.S. leadership in these and other STEM fields.
“It’s truly horrifying, there’s no other word for it,” said Kim Cobb, a coral researcher at Georgia Tech who employs a number of graduate students at her lab. “It’s like pulling satellites out of the sky.”
The most immediate harm would come to students themselves via their lost income. Estimates from Carnegie Mellon show that graduates students there could face $8,000 in added tax burden. Students aren’t exactly high earners, and many are already struggling to cover living expenses and fees with their meager stipends.
“Like many graduate students, I live paycheck-to-paycheck and make just enough to get by,” Josh Papacek, a fifth year PhD candidate who studies algae blooms and water quality at the University of Florida, told Earther. “But I still have to make very tough financial decisions, such as whether I can pay for groceries this month or if I can pay off medical bills. In addition to not making much to begin with, I actually pay back over $1,500 each year in fees to the university. I am not sure how those making less than I do would be able to survive with this new burden.”
For students studying in the Bay Area, New York, Boston, and other pricy metropolitan areas, having to pay thousands of extra dollars in taxes could be even more devastating. The fact that corporations in those areas could see a huge drop in their tax rates isn’t lost on students, either.
“GWC [Columbia’s graduate student union] worked through the numbers at a recent meeting, and considering the changes to the tax brackets and deductions involved, my taxes would increase from around 10 percent to over 30 percent of my income at over $11,000,” Colleen Baublitz, a second-year climate science PhD student at Columbia University, said. “It’s especially striking to me that corporate taxes will be reduced by half while mine will triple.”
Some students said they would be forced to consider taking on outside work in addition to their studies and lab or teaching positions, or take out loans. Neither is a particularly appealing option.
Many graduate students are already overworked, in addition to taking coursework or finishing their thesis. Student loan debt across the U.S. currently stands at $1.4 trillion, and debt is already outpacing wage growth. Frankly, the Earth and environmental sciences are not lucrative fields to begin with. More PhD graduates are filling adjunct positions than ever before, putting them squarely at the bottom of the academic pond.
“If I was pressed, I don’t think I could honestly recommend graduate school under these circumstances,” Dakota Smith, an atmospheric science Masters who recently graduated from Colorado State, said. “Financially and mentally, I don’t think it’d be worth it.”
Students and faculty members alike told Earther the plan to tax students would reduce U.S. competitiveness in attracting top tier talent from other countries. International students studying in the U.S. said if the bill were already law, they would likely have chosen to study elsewhere.
“I originally got accepted to pursue my studies at Imperial College in London, but it was financially impossible to go there,” Veronica Rebata, who graduated in 2007 from Georgia Tech after studying engineering, said. “The U.S. gave me a chance with the graduate assistantship, reduced tuition, and low tax rate. It was a deal breaker.”
Roger Bryant, a PhD student in Earth science at Washington University, said he chose the St. Louis institution over Oxford because it offered a stipend of $30,000 compared to around $18,500 at Oxford. The higher tax would wipe out that incentive.
“These changes will almost certainly mean that no British students will look to do PhDs in the U.S. in the future,” he told Earther.
Perhaps most importantly, killing the tuition waivers would put a career in academia out of reach for people raising families, or those who aren’t independently wealthy already. That would be a death knell for diversity, and leave the sciences poorer off for it.
“Though we have made big strides forward, STEM fields still have a significant issue with diversity spanning inclusion of women, people of color, [and] LGBTQ,” Greg Merrill, a Masters student studying marine science at the University of Alaska, Fairbanks, told Earther. “Under the bill, STEM and other graduate fields will be limited to those already well-off financially, further limiting who makes it in.”
All of this adds up to a brain drain that would see U.S. talent never realized, or siphoned off to other countries. Labs would empty out, breakthroughs would be made abroad, and the U.S. standing as a leader in STEM education would go up in smoke. That’s hard to square with an administration that claims to be committed to slogans like America First.
There’s still a chance the tuition tax doesn’t become law. The Senate version of the tax bill just moved out of the Finance Committee, and the tax exemption for tuition waivers is intact. Assuming the bill passes the full Senate—and there are still potential trip wires for that happening—it will then need to reconciled with the House bill. That’s why students and faculty alike said they are telling senators to make sure the tuition tax doesn’t come to bear.
“I’ve called my senators on repeat over the last several days with a singular message: it is a crippling piece of legislation to the Georgia economy,” Cobb said.