India News

US Tax reforms bill: Indian students to lose their savings

US Tax reforms bill: Indian students to lose their savings

Hyderabad:The US Senate, on Saturday, had passed the Tax Bill which will force Indian students studying in USA to pay more on taxes.

Going into the details, prior to the passage of the tax bill by Senate, graduate students who study abroad are provided tuition waiver if they choose the option of working as classroom teachers or laboratory researchers. The waiver was not taxed then.

But, now, after the Bill comes into effect, the waived fees will be treated as income.

As per Indian Income Tax Act, the scholarship given to a student for education is excluded from one’s total income.

“We get a lot of applications from students to study in America and the number increases every year. Hopefully, taxing students on assumed income will not lead to a decline in the numbers,” said an official from US consulate in Hyderabad.

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The new Tax bill makes Higher education costlier for Indian students up to $10,000 a year. Many of the students who get their tuition fee waived off are generally enrolled in Science, Technology, Engineering and Math fields.

“Waived tuition fee is not money in the bank. Therefore, taxing the same is unreasonable. Also, we work many hours a week as laboratory researchers to earn that waiver because studies abroad are expensive. Most graduate students make less than $30,000 per year with their stipend and now they will be left with no savings.” Says Ms Geeta Prasad, who studies at Penn State University.