Congress Should Cut Tuition Tax Breaks Before Cutting Pell Grants Again, argues Stephen Burd on Education Sector.
. . . at a time when the budget axe is falling on the Pell Grant program, providing billions of dollars in tax benefits to upper-middle-income families who don’t really need the help is a luxury that the government can ill afford.
For the sake of preserving access and equity in higher education, Congress should eliminate, or at least scale back, the tuition tax benefits and use the savings to put the Pell Grant program back on a sustainable path.
Despite changes that limited Pell eligibility, Congress “will need to find at least an additional $7 billion (and probably much more) to avoid slashing the maximum award in fiscal year 2014,” Burd writes. “Already there has been talk that Congress may consider eliminating the in-school interest subsidy on federal student loans entirely, or significantly reducing the amount of income students can earn before it counts against their Pell Grant eligibility—penalizing those who have to work while in college to support their families.”