Everyone Should Care About Graduate Student Tuition Waivers

Exempting tuition waivers from taxation is not only fair, but it is also a continuing commitment to the economic and societal benefits of accessible higher education, argues Mary Grace B. Hébert.

November 16, 2017

Many graduate student employees receive tuition waivers as part of their compensation package. As my fellow University of Illinois Ph.D. student Emily Rodriguez noted, these waivers are like coupons, providing a discount on graduate education in exchange for labor provided at below-market value. Although I was shocked to learn that the new GOP tax plans proposed to tax our waivers, I learned that this is not the first time such measures have been introduced.

In 1987, because of changes in the 1986 tax bill, graduate employees were unsuspectingly taxed. Luckily, colleges and universities were able to successfully lobby on graduate students’ behalf. This time around, there have been a few stories from Inside Higher Ed and other publications, including even Forbes, that position graduate students as unfortunate victims of a dispassionate Congress. Although the human cost of this regressive reform is important, this is ultimately a condemnation of education.

Like other graduate students, I was devastated when I heard the news about the tax bill. I began tweeting and talking to colleagues so that we could start organizing a response. Unfortunately, I heard skepticism from people that anyone outside academe should care about graduate student tuition waivers. Such skepticism is misguided and relies on the notion that universities are disconnected from or do not serve the public. It improperly values universities and both graduate and undergraduate education.

Land-grant universities, created in 1862 by the Morrill Act, serve the public by providing the education necessary for creating an informed citizenry and propelling economic growth. Despite the importance of higher education, universities have been hit by significant budget cuts. According to a study in Minnesota, such cuts do not save money in the long run. Researchers found that reducing subsidies for higher education would result in fewer completed degrees and lower wages for workers, as well as fewer benefits from research. The value of the individual and societal benefits of universities was estimated to be much more than the cost of subsidies. Likewise, the meager gains from taxing 145,000 tuition waivers would not outweigh the cost to our democracy and economy.

Treating graduate students like disconnected eggheads is a dismissal of the skills obtained in graduate school and of the benefits all Americans gain from a more educated society. Graduate employees perform a variety of types of work on campuses. They teach classes, in either stand-alone sections or by assisting professors; they grade papers and exams; they hold office hours; they engage in their own research and research with colleagues; they hold administrative positions; they train for their professional careers. Although this work is often thought of as necessary training for future professors, not all graduate students become faculty members.

In fact, a study of biomedical departments found that graduate students who have research assistantships go on to research and development jobs in both academia and the private sector. The same skill sets that are useful in academic research, such as strong analytical and problem-solving skills, are valuable outside academe. Furthermore, teaching, in particular lab sections of science courses, can help graduate students develop their own research skills, which may be used to develop innovations in science or technology within or outside academe.

At the University of Illinois, there is a “What Do I Do with a Ph.D. in the Humanities?” group that specializes in helping students navigate careers outside higher education. The group demonstrates that humanities graduate students have a lot to offer the public and private sectors -- including excellent writing skills, the ability to lead meetings or trainings, and the capacity to research and analyze complex ideas. It is a choice to apply the skills gained from graduate education, teaching and research in the public or private sector.

Graduate research and teaching experience are not only important for graduate students but are also formative for undergraduate students. Some of the critiques of the tax bill have focused on the deleterious effect it might have on STEM education, but the impact on the social sciences, humanities and arts is equally important. A 2012 survey reported that written and oral communication are two skills employers seek most in employees. Teaching assistants in English, communications and other departments spend hours grading papers and talking to students about how to write and present their research coherently. At the University of Illinois, many students are required to take public speaking, a course taught by graduate students within the Department of Communication. Those are skills that students can take with them in the private sphere in many fields.

Between the late 19th and mid-20th centuries, the United States invested in improving access to higher education because of the importance to individuals and society. But today, by proposing to tax graduate tuition waivers, Congress is signaling that higher education is not important to the economy. They are wrong. Education increases the lifetime earning of those with degrees and can raise the wages of those they work with. Individuals with college education and advanced degrees are more likely to vote, volunteer and give charitably.

Finally, research universities can help solve societal problems in a variety of areas. Engineering researchers at the University of Illinois recently developed a camera that could lower the cost of cancer detection. The Andrew W. Mellon Foundation recently awarded a grant to the Education Justice Project, which serves prison populations by providing education, which can improve quality of life and lower recidivism rates.

Unfortunately, there are still obstacles to access, including in graduate education. By taxing tuition waivers, Congress will create further barriers to graduate education, particularly among students from poor or minority backgrounds who may already feel isolated in higher education.

Instead of taxing tuition waivers for research and teaching assistants, Congress should be moving in the opposite direction. Exempting tuition waivers from taxation is not only fair, but it is also a continuing commitment to the economic and societal benefits of accessible higher education.


Mary Grace B. Hébert is a Ph.D. candidate at the University of Illinois at Urbana-Champaign.


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