Protecting Endowments from Our Adversaries Act

HR 4380, the "Protecting Endowments from Our Adversaries Act," imposes a 50% excise tax on private colleges and universities acquiring investments tied to entities on specific U.S. government lists (like the Commerce Department's Entity List or Defense's CMIC List) and a 100% tax on net income from those investments. It targets large private institutions with over $1 billion in non-exempt assets (excluding public schools and smaller colleges), requiring them to pay these taxes on investments in entities deemed national security risks. The bill defines "listed investments" as stocks, debt, or derivatives in companies on designated government lists, with tax calculations based on fair market value. This is a direct tax on investment income and acquisitions, not a spending or regulatory measure, affecting only institutions meeting the asset threshold.