Elite universities offer to spend more endowment cash to stave off tax hit after Trump attacks woke policies: report

Some of the richest universities in the US are proposing a deal with the federal government that would allow them to spend more of their own money in exchange for a reprieve on a proposed tax on their endowments, according to a report.Nearly two dozen elite schools — including Harvard, Yale, Princeton, Stanford, Duke and the University of Chicago — are backing a plan that would commit them to distributing at least 5% of their endowment value each year.In return, they’re asking Congress to scale back a proposed 21% tax on their investment income, a massive jump from the current 1.4% rate, the Wall Street Journal reported.The White House has framed the tax hike as a way to hold “woke, elitist universities” accountable.President Trump has launched an aggressive campaign against elite universities, accusing them of hoarding tax-advantaged wealth, embracing “woke” politics and defying federal law.His administration has moved to revoke their tax-exempt status, block access to federal research grants, and restrict international student enrollment — turning once-reliable sources of funding into pressure points.

The schools, which are part of a group called the Learn Alliance, circulated a proposal on Capitol Hill that outlines a compromise.They’ll increase annual spending on things like financial aid and research, and in exchange, they’re asking lawmakers to scrap the House-passed tiered tax system in favor of a much lower flat rate — either 2.4% or 3.4% on investment income.“What I hear from Republican members of Congress is a desire to ensure that colleges are using their charitable endowments to support today’s students and researchers rather than saving too much for the future,” Princeton University President Christopher L.Eisgruber told the Journal.“Those are valid concerns, and this proposal directly addresses them.”Eisgruber argued the plan would free up billions of dollars for student-focused spending and local economic development,...