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Lawmakers Mulling College Endowment Tax

State Would Ask For Millions From Colleges, Universities

POSTED: 6:44 am EDT April 30, 2008
UPDATED: 7:17 am EDT April 30, 2008

Some private colleges across Massachusetts may be asked to share the wealth.

It's all part of a plan being discussed on Beacon Hill aimed at finding new revenue for the state budget.

Lawmakers are considering taxing endowments at huge universities and colleges around the state.

House representatives have a proposal that would impose a 2.5 percent tax on endowments that exceed $1 billion.

There are at least seven private colleges and universities in the state that would fall into this category.

An example of how much the top schools would pay if the state adopted such a plan would require Harvard, with its $34.9 billion endowment, to pay $875 million to the state. The Massachusetts Institute of Technology, with its $9.9 billion endowment, would pay $247 million to the state. Boston College, with its $1.75 billion endowment would pay $43.75 million in new taxes to the state.

There are four other schools that also have endowments exceeding $1 billion. They include Boston University, Smith College, Tufts University and Wellesley College.

The endowment tax is a popular idea among house lawmakers who have already voted to send it in a study proposal to the Department of Revenue.


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