nuureaa at tits
Mil: 30535

December 7, 2017

The Honorable Mitch McConnell The Honorable Paul Ryan

317 Russell Senate Of?ce Building H-232 The Capitol 
United States Senate United States House of Representatives
WaShington, DC 20510-0001 Washington, DC 20515-0001
The Honorable Orrin Hatch - The Honorable Kevin Brady
104 Hart Senate Of?ce Building 1011 Longworth House Of?ce Building
United-States Senate United States House of Representatives

Washington, DC 20510-0001 Washington, DC 20515-0001

Dear Leader McConnell, Speaker Ryan, Chairman Hatch, and Chairman Brady:

We the undersigned strongly oppose therepeal of the income exclusion for graduate tuition waivers
in the Tax Cuts and Jobs Act as passed by the House of Representatives on November 16, 20.17.. A
tax on graduate tuition waivers would be unfair, would undermine our-competitive position,- and
would inhibit the economic growth that tax reform promises. I

Repeal of the income exclusion for graduate tuition waivers would subject thousands of graduate
students to a major tax increase at a time in their lives when they likely lack the ability to pay.
Graduate students never see the money from a graduate tuition waiver. Their university charges them
for tuition then immediately waives it. Under current law, this waiver is not taxable. According to the
Bureau of Labor Statistics, a graduate teaching assistant earns a median wage of $34,240, yet repeal
of this income exclusion would increase the taxable income of these graduate students by $12,000?
$50,000. The income exclusion under current law protects students from paying a substantial tax at a
time when they simply cannot afford it, and it should not be repealed.

Taxing graduate tuition waivers would not only harm students but also adversely impact the United
States? technological position. In 201 1-12, 57% percent of waiver recipients were graduate students
in science, technology, engineering, and math. A policy that increases students? costs would
discourage our nation?s brightest minds from developing greater expertise in their area of study and
engaging in leading-edge research. These potential graduate students are our country?s future medical
researchers who discover life-saving cures; engineers that develop cost?saving methods production;
and software programmers that code the next market-transforming mobile app. Tax policy should
make our country more competitive, and creating barriers to technological progress is contrary to that

goal

The primary motivations for tax reform have been to fuel economic growth, create jobs, and raise
wages, and a well-educated workforce is critical to those ends. Businesses simply demand it. For

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example, Amazon?s request for proposal for its second headquarters location listed ?a highly

educated labor pool? as a decision driver and ?a strong university system? as a requirement. For

businesses to grow and hire, they need access to a labor pool that meets their needs. As the economy

transforms, businesses increasingly demand specialized graduate education. If businesses cannot ?nd
the requisite talent domestically, we risk that they will invest in growth and jobs elsewhere.

A repeal of the income exclusion for graduate tuition waivers would harm our nation?s students,
undermine our competitive position, and hold back economic growth. We strongly urge you to

ensure that this harmful provision is not in the ?nal version of the Tax Cuts and Jobs Act.

Sincerely,

 

 

Pete Sessions
Member of Congress

 

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