Trump Takes Aim at Harvard’s Tax Haven—Bessent Claims Political Vendetta Masquerading as Fiscal Reform

Scott Bessent drops bombshell: Former President Trump is reportedly gunning to revoke Harvard’s sacred tax-exempt status. Because nothing says ’draining the swamp’ like targeting Ivy League endowments while private equity still gets a free pass.

Higher ed’s $40B ivory tower could face an IRS reckoning—if the political theater ever translates to policy. Meanwhile, Wall Street laughs all the way to the actual bank.

Trump targets Harvard’s student programs and endowment

The push from the administration doesn’t stop at taxes. On Thursday, Homeland Security Secretary Kristi Noem announced that Harvard would lose its Student and Exchange Visitor Program certification starting in the 2025-2026 academic year. 

That move, made without any public evidence, accused the school of “fostering violence, antisemitism, and coordinating with the Chinese Communist Party.” Harvard pushed back, saying it’s committed to fighting antisemitism and continuing investigations into all valid civil rights complaints.

The issue of international students has now also landed in court. On Friday, US District Judge Allison Burroughs temporarily blocked a TRUMP administration order that would have prevented Harvard from enrolling foreign students.

Burroughs sided with the school, saying the policy — which had been imposed only a day earlier — could cause “immediate and irreparable injury.” 

According to Harvard’s lawsuit filed in Boston federal court, the new rule violated the Constitution and federal law, and would have had an “immediate and devastating effect” on over 7,000 visa holders. The school added, “Without its international students, Harvard is not Harvard.”

Harvard currently has nearly 6,800 international students, making up 27% of its student body. Among those affected is LEO Gerden, a Swedish student about to graduate with a degree in economics and government. Leo said the ruling was “a great first step,” but added that “there is no single decision by Trump or by Harvard or by a judge that is going to put an end to this tyranny of what Trump is doing.”

White House press secretary Abigail Jackson criticized the court’s decision, saying, “unelected judges have no right to stop the Trump Administration from exercising their rightful control over immigration policy and national security policy.”

Bessent questions how Harvard manages its money

Scott also went after Harvard’s enormous $53 billion endowment, calling it out directly. “Harvard is a gigantic hedge fund,” he said. “They run a Leveraged investment model, so we’ll see where all that goes.” He also said the administration is examining ways to apply new taxes on college endowments.

The US House of Representatives just passed legislation targeting wealthy schools like Harvard, MIT, and Yale, imposing higher taxes on their investment income.

The Harvard endowment is managed by the Harvard Management Company, which was restructured by its current CEO. The company slashed its internal staff from 230 to half, adjusted executive pay, and moved more assets to outside managers. That restructuring is now being framed by Trump’s team as proof that the university functions more like a financial institution than a school.

Since Trump returned to the WHITE House in January, his administration has accused several universities of failing to protect Jewish students during on-campus protests tied to Israel’s military actions in Gaza. Harvard said around 20% of its international students in 2024 came from China, which has only fueled further attacks from the administration over alleged foreign influence.

While Harvard is fighting back through the courts, other schools are taking different routes. Columbia University, under pressure from the administration, agreed to reform its disciplinary procedures and review its courses on the Middle East after Trump cut $400 million in funding from the school over claims it hadn’t done enough to fight antisemitism.

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