A major Republican tax overhaul, if passed by the United States Senate, will make it tougher for college students to receive tax benefits for their student loans. At a panel discussion on Monday, Congressman Salud Carbajal warned University of California, Santa Barbara students that the proposal will give 80 percent of tax benefits to the top one percent of the country.
On Tuesday, the Senate Budget Committee voted to pass the bill, which means the Senate may now vote on it later this week. If passed, college students would lose the ability to deduct up to $2,500 from taxes paid on their student loan interest.
The U.S. House of Representatives already passed a GOP tax proposal on Nov. 16, which also mandates that graduate students who serve as teaching or research assistants would need to pay income tax on tuition waivers they receive for their work. If the Senate passes its version of the plan, the two proposals will merge to create a final tax plan to be adopted by Congress.
While the plan primarily cuts corporate tax rates and simplifies the U.S. tax code, the bill’s effect on college students prompted the Associated Students External Vice President for Statewide Affairs (EVPSA) Kristin Hsu to invite Carbajal and others to participate in a discussion at the Graduate Student Association Lounge.
On Wednesday morning, UCSB students will organize at Storke Tower for the national Grad Tax Walkout/Rally to Save Higher Education. Dozens of similar walkouts will take place concurrently at campuses across the nation.
Carbajal, who represents California’s 24th Congressional District (including Santa Barbara County) wasted little time in slamming the bill as unbalanced.
“It basically hurts the middle class,” Carbajal said. “It makes the middle class pay more taxes for the next 15 years and it is the biggest gift and giveaway to the wealthiest of our country.” He went on to say the bill was developed “behind closed doors,” before Republican legislators sprung it onto the House and Senate, framing the vote in a partisan way. Clearly, he said, the vote undermines students who receive student loans.
“It undermines the ability to write off the graduate tuition waiver by counting it as income now,” Carbajal said.
Bruce Kendall, the associate dean of UCSB’s graduate division and a professor at the Bren School, echoed Carbajal’s concerns.
“We want all of you to actually be able to afford to live,” Kendall said. But in-state graduates who work for the entire school year as TAs or researchers may see tax increases of up to an estimated $1,900, he said — prompting gasps among the dozens of grad students filling the room.
Meanwhile, Kendall explained, international students working at the same capacity can anticipate tax increases of up to $4,000. Both of these increases should be “unacceptable” to administration and faculty, he said. As a direct result, fewer students will be able to attend UCSB.
Megan Undén, a graduate student and chair of Santa Barbara UAW 2865 — a union for TAs, tutors, and readers — went a step further in spelling out the consequences.
“In part, funding was developed so we could have more types of people in academia — first-generation, students of color, women,” Undén said. “So an attack on funding changes who can become professors.”
“This is a very sneaky way to attack higher education.” She urged students in attendance to call up their representatives and encourage friends attending schools in Republican districts — like Irvine — to convince their congresspeople to protect their tax benefits. In addition, students should participate in Wednesday’s walkout, she said.
Jonathan Abboud, Santa Barbara City College trustee and UCSB graduate student in the Technology Management Program, spared little ambiguity when it came to the partisan element of the tax plan.
“Republicans do not care about you,” Abboud sharply told an audience member who asked about the GOP’s reasoning behind the bill. “They don’t believe in higher education. They don’t want to make it easier for you to go to graduate school.”
Abboud later stressed the importance of keeping Carbajal in office.
“The Republicans want to take him out,” Abboud said. “They’re going to put a lot of money into some Republican guy, maybe the guy who ran last time,” referring to former congressional candidate Justin Fareed — who intends to run for Congress a third time in 2018.
Asked later about his comments, Abboud doubled down.
“I think it’s very clear that the national Republican Party doesn’t care about people of color or low-income people,” said Abboud, who called Fareed a “seat-warmer” for the Republican vote and “not a serious candidate.”
“He’s barely older than me and has less experience doing anything in the community,” Abboud said, “so I don’t think he’s a credible candidate to represent us in Congress.”