Universities Fear Endowment Tax Hike Amid Congressional Heat

Proposals to raise taxes on university endowments are getting renewed attention amid rising pressure from Congress over the handling of campus protests over the Israel-Hamas war.

Republicans in Congress have upped their calls to investigate universities’ tax-exempt status and criticism is growing of the elite schools’ billion-dollar-plus endowments. Lawmakers on both sides of the aisle have blasted universities, like Columbia and Harvard, alleging in some cases that they have failed to protect students against antisemitism.

Some Republicans have floated hiking the 1.4% tax on endowments created by the 2017 tax law to as high as 35% for certain universities. The ...