Senator Vance announced Thursday that he will introduce a bill that would tax the capital gains of college and university endowments at a whopping 35 percent, up from the meager 1.4 percent rate the endowments currently pay. The bill is tailored to only affect America’s largest higher education institutions. 

“The endowments at Penn, Harvard and MIT have a combined $95B+ in assets — yet only pay a 1.4 percent tax rate on net investment income,” Mr. Vance wrote on X on Thursday. “Then they use these funds to push DEI and woke insanity. My bill would tax the largest endowments at 35 percent — it’s going to the Senate floor right now.”

The bill would only include endowments with assets worth $10 billion or more. According to an April report from the National Association of College and University Business Officers, just a dozen colleges and universities have endowments of that size, including Harvard, Yale, Stanford, MIT, and Columbia. The legislation would exempt religious universities, so while the University of Notre Dame has a nearly $17 billion endowment, it would not be affected by the tax. 

According to Barron’s, Harvard’s $50.7 billion endowment grew by 2.9 percent in the last fiscal year, meaning Mr. Vance’s 35 percent capital gains tax on endowments would have raised more than $500 million from Harvard alone. Harvard says gains from its endowment accounted for one-third of the university’s total operating revenue in the most recent fiscal year.

When Mr. Vance tried to have the legislation adopted by unanimous consent on the Senate floor, he was blocked by a Democratic colleague, Senator Wyden. 

The university endowment tax was first established by President Trump’s 2017 tax bill and levies a 1.4 percent tax on endowments of schools with more than 500 students and at least assets of $500,000 a student. According to the Internal Revenue Service, that tax raised $68 million for the federal government in 2021. 

Higher education has taken a special beating in the weeks since the launch of Hamas’s October 7 attack, school leaders’ insufficient responses to the subsequent displays of antisemitism, and the abysmal testimony of three elite university presidents before the House Education Committee. 

Mr. Vance’s proposal comes as the House launches its investigation into antisemitism on college campuses, and Republicans across the country are looking to dismantle DEI bureaucracies at major institutions. Previously, bills have been introduced in both the House and Senate to tax endowments, but not at the level the Ohio senator is now proposing. Democrats opposed those previous efforts. 

In Wisconsin, Republicans in the state legislature recently played hardball with the Democratic governor and the University of Wisconsin Board of Regents. Wisconsin assembly speaker Robin Vos told the state university system that he would approve an additional $800 million in school funding, but only if the board froze hiring at all DEI offices across the system’s 13 individual universities. 

The board narrowly rejected the deal in a nine to eight vote on Saturday, only to turn around and approve the deal on Wednesday by a margin of 11 to six. 

In Oklahoma, Governor Stitt is also taking aim at DEI bureaucracies in what he calls an “anti-discrimination” crusade. On Wednesday, the governor signed an executive order that “requires state agencies and institutes for higher education to initiate a review of DEI positions, departments, activities, procedures, and programs to eliminate and dismiss non-critical personnel.”

In a statement, Mr. Stitt said, “Encouraging our workforce, economy, and education systems to flourish means shifting focus away from exclusivity and discrimination and toward opportunity and merit. We’re taking politics out of education and focusing on preparing students for the workforce.”