WASHINGTON — The moment the last of Fred Vautour’s five children walked across the stage as a Boston College graduate was priceless.
Not only did he have the rare distinction of handing each of them their diplomas, but he was also able to pay for their nearly 18 years of schooling by collecting trash, scrubbing toilets, and mopping floors while the campus slept.
“As much as I struggled, it was incredible to be able to do that for them,” said Vautour, 64, who has worked the graveyard shift as a custodian at Boston College for 17 years. “I took this job for benefits, but never imagined this would be one of them.”
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It may not be one for long — or at least could be severely curtailed. The sprawling House tax bill, set for a vote on Thursday, would tax the value of college tuition benefits conferred on thousands of university employees like Vautour, one of several provisions that would hit colleges, universities, and their students, hard.
Republicans drafted the bill with the premise that it would simplify the nation’s tax code and cut rates for middle-income Americans. To help pay for the $1.5 trillion tax cut, lawmakers eliminated many individual tax breaks, arguing the overall plan would compensate for any lost benefits. The result: While many families and businesses would see tax cuts, a large percentage of undergraduates and graduate students would see their tax bills increase, some dramatically.
In addition to campus employees, many doctoral students would see huge tax increases, since the tuition that universities waive for them in exchange for working on campus as researchers and teaching assistants would be deemed taxable income. At expensive research universities like Stanford and Harvard, the new tax bills could swamp graduate-student stipends.
And if students take out more loans to pay their new taxes, they would face another surprise: Under the House bill, interest paid on student loans — a deduction that more than 12 million people used in 2015 — would no longer be tax deductible.
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“These benefits ensure the brightest and best in the country can continue to afford an education,” said Steven M. Bloom, director of governmental relations for the American Council on Education, which represents 1,800 college and university presidents across the country. “Congress is sending a clear message that they’d rather use that money for corporate tax breaks.”
The Senate bill being drafted this week leaves out most of the higher-education provisions in the House bill. The Senate bill also retains other smaller tax credits and benefits that the House sought to repeal, such as a nontaxable annual grant of up to $5,250 that employers can offer their employees.
All told, the House’s Tax Cuts and Jobs Act would reduce tax benefits and savings for college students by $65 billion over the next decade, according to an estimate by the education council.
House Republicans defend the higher education provisions as contributing to the tax bill’s larger economic goals.
But students and advocates say the higher-education provisions actually undermine what is supposed to be the central aim of the tax overhaul: to bolster the middle class.