The Harvard Crimson on a possible endowment tax

The Editorial Board of the Harvard Crimson, not unexpectedly, opposes the 2.5% tax on endowments being discussed in the State House. But if the proceeds of the tax were earmarked to support "appropriate" causes (whatever that means) then much of their objection seems to melt away. What they don't want is an endowment tax going into the State's general fund.

The editorial starts by explaining what a terrible idea this tax would be because it might discourage contributions to the wealthy schools. So these two conflicting arguments don't really fit together - is any taxation of billion dollar endowments a bad idea, or is it a good idea so long as the money goes to help the homeless at the Pine Street Inn instead of pensions for former Big Dig managers?

The Harvard Crimson :: Opinion :: The Tax Stops Here

"Colleges and universities have missions that commit them to serve and better the community, callings that shouldn’t be reduced to assuage the problems the state government can’t handle. Perhaps this proposal would have been more amenable if the money taken by the state went directly to struggling non-profit organizations around the Commonwealth or other salutary areas."

"Harvard, and its wealthy peer institutions should use some of the money that they have rightfully generated to give back to the communities that host them. There is nothing wrong, and much to be lauded, about donating some of their sizable endowments for philanthropic purposes."

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