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The Telegraph
The Telegraph
2 May 2025
US Staff


Trump says he will remove Harvard’s tax exempt status

Donald Trump said he will revoke Harvard University’s tax-exempt status.

“We are going to be taking away Harvard’s tax exempt status. It’s what they deserve!” Mr Trump wrote in a post on Truth Social.

The university is already in a legal battle with the Trump administration over the freezing of £1.7 billion ($2.2 billion) in federal grants.

Mr Trump initially threatened to revoke the status last month.

On April 15, he said: “Perhaps Harvard should lose its tax exempt status and be taxed as a political entity if it keeps pushing political, ideological, and terrorist inspired/supporting ‘sickness?’”

Harvard, the nation’s oldest and wealthiest university, said a revocation of its tax-exempt status would be unlawful and unprecedented.

A spokesperson said: “There is no legal basis to rescind Harvard’s tax-exempt status.

“The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.”

The move would also cut money available for student scholarships, medical research and technological advancements that drive economic growth, the Harvard spokesperson said.

Most universities, including Harvard, are exempt from federal income tax because they are deemed to be charitable organisations.

The exemption also allows people to make tax-deductible donations.

Following the implementation of a 2017 law, Harvard and other universities have to pay a 1.4 per cent excise tax on their endowments.

Harvard’s endowment amounted to £40 billion ($53.2 billion) as of the 2024 fiscal year, when it paid more than £33 million ($44 million) in taxes.

The Democrats have asked the Treasury to investigate any Inland Revenue Service actions being taken against Harvard.

Diane Yentel, president of the national council of non-profits, said in a statement Mr Trump’s actions are an abuse of executive power and “an existential threat to the entire nonprofit sector.”

“If the Trump administration can silence universities today, who will be next?” Ms Yentel said.