What Is the Pink Tax?
Gender inequality researchers often highlight the “pink tax,” an extra charge on goods and services targeted at women, which results in men paying less for comparable products and services. The issue gained significant attention when New York City’s Department of Consumer Affairs investigated 794 products sold in the city for consumers of all genders, revealing instances of gender-based pricing. However, this phenomenon has been observed and studied by researchers as early as the 1990s.
Attempts to Regulate the Pink Tax
When a company sells a pink product (the female version) at a higher price than a blue product (the male version), the additional revenue from the pink product goes directly to the company, not the government. The beneficiaries of the “pink tax” are the companies that charge women more than men for similar products.
On the other hand, the “tampon tax” refers to the sales tax that many states impose on feminine hygiene products, which disproportionately affects menstruating girls and women, as well as their fathers or husbands in some cases. While related, the tampon tax is distinct from the pink tax, and we won’t delve into it here. The pink tax also does not include the cost of items like lipstick and menstrual products that women frequently use and pay for throughout their lives but are not typically used by men.
Several states have enacted laws to combat discriminatory gender-based pricing of products and services. There have also been attempts at the federal level to pass similar legislation. The aim is to regulate and eliminate unfair price discrepancies, as women already earn less income, and it’s unjust for them to pay more for equivalent products and services.
California
In 1996, Governor Pete Wilson of California enacted the Gender Tax Repeal Act of 1995, which mandated that merchants charge men and women the same price for services that required equal time, cost, and skill to provide. This law specifically targeted services like haircuts, dry cleaning, clothing alterations, car repairs, and others, rather than products. The bill’s author, Assemblywoman Jackie Speier, mentioned to the Los Angeles Times that it was the first state law of its kind. During that period, the term “gender tax” was used to describe this form of apparent price discrimination. An earlier version of the bill, which also addressed products, did not pass.
New York City
In 1998, Mayor Rudy Giuliani of New York City signed a bill to address the issue of gender-based pricing in retail establishments, including haircutters and dry cleaners. The legislation empowered the city’s Department of Consumer Affairs to impose fines on those found in violation. The law specifically banned the display of discriminatory pricing, meaning businesses couldn’t have signs that showed different prices based on gender. For instance, you wouldn’t see a sign like “women’s haircut $45, men’s haircut $25” at a New York City hairdresser under this law.
Miami-Dade County
Miami-Dade County in Florida has an ordinance against gender-based price discrimination that covers both goods and services. The responsibility of enforcing this local law lies with the Consumer Services Department of Miami-Dade County. It applies to all sellers, regardless of whether they are individuals or corporations. The ordinance specifically prohibits price discrimination solely based on the customer’s gender, but it does allow for price differences when justified by factors such as the time, difficulty, or cost of providing a good or service. If someone believes they have experienced gender-based price discrimination, they can file a complaint in writing with the Consumer Services Department. In cases where the ordinance is violated, the affected parties have the right to sue for damages, attorney’s fees, and court costs.
United States House of Representatives
Assemblywoman Jackie Speier, who sponsored the California Gender Tax Repeal Act in 1995, made further efforts at the federal level in 2016 by introducing the Pink Tax Repeal Act. Despite several attempts to pass the bill, it has not been successfully enacted into law. The purpose of the Pink Tax Repeal Act is to prohibit the pricing of consumer products and services that are substantially similar but priced differently based on the gender of the individuals for whom they are intended or marketed. If passed, companies found in violation of this law would be considered in violation of the Federal Trade Commission’s rules on unfair or deceptive acts or practices affecting interstate commerce. The bill aims to address the issue of gender-based price discrimination at a national level.
The Real Pink Tax: Unequal Tariffs on Women’s Goods
The term “pink tax” is often used to refer to gender-based price discrimination in the pricing of goods and services, and it is not an actual tax imposed by the government. However, in some instances, import tariffs on certain clothing items can contribute to this price difference. According to a study by Texas A&M University’s Mosbacher Institute, clothing companies in the United States pay higher import tariffs on specific women’s items, such as silk shirts, wool jackets, cotton suits, suit jackets, blazers, leather shoes, and golf shoes. On the other hand, import tariffs on men’s apparel are higher on items like cotton shirts, wool suits, synthetic fiber suits, and swimwear. Some items have no gender-based tariff difference, while others show significant differences. Overall, tariffs on women’s items tend to be higher.
To address this tariff discrepancy, clothing companies can either increase the price of the item with the higher import tariff, resulting in a gender-based price difference based on the item’s cost, or they can price both items equally (assuming they are otherwise the same). In the latter case, either the producer, the retailer, or the consumer may bear the impact.
Despite efforts to challenge these tariff discrepancies, they persist. A 2020 study published in the American Political Science Review analyzed tariffs on men’s and women’s apparel in 167 countries over 20 years. The study’s authors found that, on average, imports of women’s goods are taxed 0.7% more than imports of men’s goods, contributing to the pink tax. They also suggested that increasing women’s representation in legislatures could potentially help address this issue.
Why the Pink Tax Is Not a $1,351 Problem
In 1994, an analysis conducted for the California Senate’s Gender Tax Repeal Act of 1995 (AB 1100) revealed that women were paying approximately $1,351 more per year for similar products and services compared to men. This figure from 1994 is still frequently cited as if it were current, even on social media campaigns like #AxThePinkTax, and is often included in discussions about the pink tax. However, it’s important to note that this figure is highly unlikely to still be accurate, and simply adjusting it for inflation wouldn’t make it current either.
Over the years, changes in product prices based on supply and demand, as well as various efforts and campaigns to address gender-based price discrepancies, have likely altered the amount significantly since 1994. While it may be challenging to update the figure accurately due to the complexity of calculations involved, it’s essential not to rely on outdated estimates when discussing gender price disparities. Using outdated figures can hinder efforts to address gender-based pricing issues effectively and doesn’t provide a realistic picture of the current situation.
How Does Gender Pricing Work?
Gender pricing, often referred to as the “pink tax,” is not a tax in the traditional sense. It describes the phenomenon where women are charged more for the same or similar products and services compared to men.
Is the Pink Tax Still Prevalent?
Yes, the pink tax is still prevalent despite not being an official tax. While some state and local governments have enacted laws to prohibit gender-based price discrimination, there is currently no federal law addressing this issue.
What Products and Services Are Affected?
Numerous products and services fall under the so-called pink tax. Common examples include apparel items like jeans and services such as haircuts. Additionally, certain children’s toys marketed to girls may also be subject to gender-based price disparities.
The Bottom Line
The pink tax is not technically a traditional tax, except in cases involving uneven import tariffs on women’s apparel. However, it is evident that numerous products aimed at women are priced higher compared to nearly identical products targeted at men. Gender-based price discrimination is a tangible issue, though the reasons behind its existence, as well as the extent of its impact, may be subject to debate.
