Bessent says Trump administration moving forward on Harvard tax threat

Treasury Secretary Scott Bessent said President Donald Trump is “moving forward” with efforts to revoke Harvard University’s tax-exempt status, ratcheting up the government’s high-profile clash with one of the nation’s wealthiest and most prestigious schools.

Harvard may not be complying with some of the rules that govern institutions with the federal tax benefit, Bessent told Bloomberg Television’s David Westin on Friday. “We will see if they are following the rules,” he said. “It looks like there is a substantial number where perhaps they weren’t.”

Trump raised the possibility of revoking Harvard’s tax-exempt status earlier this month in a Truth Social post, saying “we are going to be taking away Harvard’s Tax Exempt Status. It’s what they deserve!”

The Treasury Department sought to clarify Bessent’s remarks in a statement late Friday.

“Regarding tax status, whether its Harvard or any other university, tax-exempt status is a privilege and not a right, and it is up to the established processes of the IRS to ensure that any nonprofit is abiding by its legal obligations to retain such a designation,” the statement said.

It added that the president “is moving forward with a whole of government approach of reforms to higher education, ensuring that these institutions are aligned with the rules associated with the privileges they’ve been granted.”

Experts say that revoking Harvard’s tax-exempt status would be a long process that could take years as it works its way through the Internal Revenue Service and likely the courts. The Cambridge, Massachusetts-based school has cautioned that removing its tax benefits would have “grave consequences for the future of higher education in America.”

Under federal law, the president and other top officials are barred from directing the IRS to investigate or punish specific taxpayers, including universities.

Bessent’s comments came as tensions between the White House and Harvard continue to rise. A federal judge in Boston on Friday temporarily blocked a separate administration directive that would have barred Harvard from enrolling international students. US District Judge Allison Burroughs sided with the university, saying the policy — imposed a day earlier — could cause “immediate and irreparable injury.” International students make up about 27% of Harvard’s student body.

Bessent also said the administration is looking at taxes on college endowments. The university, along with other elite institutions including the Massachusetts Institute of Technology and Yale, are facing a steep tax on their endowments under legislation that passed the US House of Representatives on Thursday.

“Harvard is a gigantic hedge fund. They run a leveraged investment model, so we’ll see where all that goes,” Bessent said.

Harvard’s $53 billion endowment is run with a smaller group of in-house professionals at the Harvard Management Co. The current CEO of the endowment overhauled the Harvard fund, cutting half the endowment’s 230-member staff, revamping pay and later shifting toward external managers.