Monday, December 7, 2009

Taxing Higher Education

In a recent Pittsburgh Post-Gazette, there was an article on the very controversial higher education tuition tax proposal put forward by Mayor Luke Ravenstahl.  The proposal as it stands (even though there are now efforts to scrap the proposal) is a one-percent levy on tuition, labeled by the Mayor as a Fair Share Tax and designed to raise $15 million per year.  There is no question that many cities and many states are in difficult financial shape, and unlike the federal government, deficits are not an option.  But in plugging a budget shortfall, the negative impact of any tax increase or spending cut should always be minimized to the extent possible, both in an immediate as well as in a longer term sense.  For example, instituting a tax on preventative health care would be a mistake in the moment and  the future but having that same (or a greater tax) levied on purely cosmetic surgery might be a good luxury tax revenue source.  It should be clear to everyone that creating an added barrier that will prevent some individuals from visiting their doctor is very negative and results not only in more work days lost (impacting business), more costly health care expenses in the future (for the individual, for insurance companies, and for government) and more needless deaths.  On the other hand, reshaping a part of your body or having a tuck here or there (or everywhere) may be desirable and pleasing to the eye but is in most cases purely a luxury purchase  with limited, if any, negative tax consequences.

Just as good health care should be viewed as a necessity, higher education should be viewed the same way.  I recognize that we are not talking about sick days or needless deaths.  But please remember that many of the jobs that required only a high school diploma when I was growing up, now require at least a bachelor’s degree and often more.  Where ten years ago you could be a physical therapist with a bachelor’s degree, now a doctorate is the degree of choice for the field and a bachelor's is no longer acceptable.  And functioning in an ever more complex society and world requires ever more education.  Why then would we place any tax or added impediments in the way of an individual pursuing his or her higher education?  Even at a time, when resources are very constrained every effort should be made to encourage students to pursue their education to the greatest extent possible.  And please also remember that there is a direct correlation between the level of educational attainment, the income earned and the taxes paid over a lifetime.  If we are trying to maximize tax revenues going forward, increasing barriers to higher education is a totally negative and counterproductive strategy for doing so.


  1. I think they should tax only those who enroll in political science courses. This would be a way of driving these parasites out of society by killing them off in the larval stage.

  2. While I realize that you are using the comparison to health care as an appropriate example of the consequences of inappropriate taxes I think you missed an opportunity to open a broader taxation debate.

    The Mayor of Pittsburgh, like many, are seeking revenue where they have no right to go.
    Education, so often referenced by those who are running for office, is a non-negotiable necessity to function in our society. The costs of education are staggering and our government officials, always claiming to worry about the children and their future, had better face the scenario that if they stick their hand into the pocket of those seeking higher educations, they will end up with fewer pockets and a future workforce not educated enough to keep moving forward.

    Here on Long Island Hofstra had to give up a football program to make sure that it as a resposible institution of higher education had the fuel to offer to their students the programs to carry them forward. Imagine all of those who are committing an average of $40,000 a year to increase their ability to serve society had to face a 1% tax on that amount while balancing all other costs. Would state schools be immune? Would institutions have to subsidize the payor of that levy?

    However your example of health care may actually fuel these tax nuts. Afterall they could argue that a doctorate is like plastic surgery as it will make the student more appealing to make more money in their lifetime and therefore they should spread the benefit of that degree. Perhaps they should tax the tolls on bridges as well as there is a benefit to cross a bridge.

    What I am saying is that we not only need to fight this nonsensical greed of our politicians but also understand that they are attacking those in society that choose to better themselves. These regressive, anti-success, anti-social taxes are geared at punishing those in society who wnat to be in a position to contribute to the very same society as they progress.

    We are creating an America of those who have and those who don't...those who try and those who don't...those who reach and those who don't. We have to go back to a society that functions with all and rewards those who do try to go to the next level by achieving an education. We also have to have a society that encourages and tries to create a path where all have that opportunity at a higher education. Gee that may mean tax breaks for pursuing a higher education.