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Pink Tax-Rising Gender Disparity – IMPRI Impact and Policy Research Institute

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Pink Tax-Rising Gender Disparity - IMPRI Impact and Policy Research Institute

Bhanvi

In history, the color pink was commonly worn by men and the ornamentation of masculine attire with embroidered flowers was not unusual as a result color pink didn’t always symbolize femininity. Pink wasn’t a ‘girly’ color until World War- II (Stamberg, 2014). The fashion designers of the time, with an agenda aimed to dismantle the masculinity that women had fared during wartime, were successful in returning women to their role of feminine housewives. When men first left for war, war propaganda (posters) depicted a woman dressed in blue, ready to support the war effort and fill the vacancy in the jobs left by men.

As soon as the war ended, the propaganda shifted to represent women returning to their roles as helpful housewives. Simultaneously, fashion designer Dior designed a new version for women, which played off traditionally feminine shapes and contributed to the introduction of pink into women’s clothing. As a result, the pink tax widens its root with pink becoming the strong symbol of femininity, though, historically pink was associated with masculinity. Gradually the color pink became the marketing strategy to distinguish between the products manufactured for men and women separately.

World War II color poster depicting “Rosie the Riveter” and women working in gas chambers

INTRODUCTION

A tax is a compulsory payment or fee levied on individuals or enterprises by local, state, and national governments to cover the costs of general government services, goods, and activities. Gender-based pricing discrimination is defined as a situation in which there is a disparity between the prices charged to different genders for homogeneous or similar goods and services. This gender-based price discrimination has given rise to “Pink Tax” which is defined as a surcharge that women pay on a daily basis for goods and services that are identical to or equivalent in quality as compared to men’s products.

But the major concern is that the issue and subject matter of gender taxation have not been taken seriously and thoroughly researched as it is often argued that this gender disparity in terms of taxation doesn’t exist in India, but the reason is that people are unaware of this hidden tax. Currently in the light of G20 government is focusing on achieving various SDGs and the elimination of the pink tax will be a step forward toward gender equality.

Is Pink Tax the flagbearer of rising patriarchy?

According to a study conducted by New York City’s Consumer Affairs in 2015, they examined 5 industries, 24 stores, 91 brands, and 794 products, and reported women’s products are 7% more expensive than men’s products. Society’s cultural norms give rise to consumer price disparity that can be differentiated via the cost of being a female as these societal norms play a detrimental role in letting the pink tax flourish in the economy.

History also clearly depicts patriarchy as earlier in ancient Egypt women were not allowed to own property like their male counterparts and many women were not allowed to open bank accounts without the permission of their husbands etc which shows a male-dominated society. Furthermore, the wage gap between men and women is still prevalent, along with occupational differentiation by gender, which contributes to a difference in earnings.

According to The World Economic Forum’s Global Gender Gap Report 2022, it was found that when it comes to wage equality for similar work, only five out of the 146 countries analyzed achieved scores higher than 0.80. (A score of 1.0 would mean full wage parity). Moreover, 129 countries reported a downfall in women’s labor-force participation relative to men’s. The report concluded that the gender pay gap is one of the most salient factors contributing to the overall gender-based wealth inequality.

STRATEGIES TO CHARGE PINK TAX

There is a quote “Shrink it, pink it, and women will buy it at a higher price”. According to research done regarding color preference among genders, by respected neuroscientists, Anya C. Hurlbert and Yazhu Ling it was found that women naturally favor shades regarded as ‘reddish-purple’ whereas men are naturally attracted to colors within the range of blue and green.

Moreover, it is costly to produce a small amount of pink products as compared to any other color such as green or blue. In 1994, the State of California investigated the problem of gender-based pricing of services and estimated that women paid a yearly “gender tax” of around $1,351 for the same services as males. While the DCA (Department of Consumer Affairs) study did not assess the annual financial impact of gender pricing for items, the data show that women pay thousands of dollars more over the course of their lives to purchase equivalent products as men. 

Alteration in packaging plays a significant role in determining the price of a product which is achieved by changing the color of the package to pink, purple, and similar shades and by changing the shape and size of the product and playing with its primary and secondary packaging.

The crucial difference rises at the marketing stage as in the case of the personal care kit offered by BOSS that offered the same products in both packages differentiated for men and women, but the packaging and social mindset of people helps them to generate additional revenue by way of pink tax. The rationale behind this is capitalism which is to generate maximum profits and not to cater to the specific needs of individuals.

Price discrimination is another significant factor as it means a different price is charged for the same good or service. For example, the cost of tickets for visiting an amusement park is lesser for children as compared to adults. So, whenever companies analyze the market trends and conclude that women will be willing to pay more for a product or service, they charge them in the form of hidden tax (Pink Tax). Hence it is concluded that women are less price sensitive.

DISPARITIES IN CHARGING TAX / GENDER-BASED TARIFF

Gender-based differences are commonly witnessed in many sectors specifically in personal care i.e. soaps, deodorants, razors, moisturizers, etc that are specifically distinguished for men and women. Whereas such items do not need additional attributes or special features while designing to make them suitable for a specific gender. 

Moreover, women end up paying more for services also as compared to men such as oil massaging, dry cleaning, hair-cutting, traveling, etc. According to a report released by researchers at New York University’s Rudin Center for Transportation on the “pink tax”, women in New York City spend an average of $26 to $50 extra on transportation per month for safety reasons, and sometimes add up to $100 each month if they are their family’s main caregiver that accounts to  $1,200 more than men each year.

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Average prices for both men and women are calculated by taking products of different companies and a study conducted by the New York City Department of Consumer Affairs 

Additionally, the study by the New York City Department of Consumer Affairs concluded that Products for women and girls cost 7% more than comparable products for men and boys differentiating into 7% more for toys and accessories, 4% more for children’s clothing, 8% more for adult clothing, 13% more for personal care products, 8% more for senior/home health care products.

There have been several campaigns in India for the removal of Goods and Services Tax (GST) on sanitary napkins due to differential pricing for women’s products, due to this agitation the GST OF 12% was taken back, moreover, tax on tampons was imposed considering it to be a luxury item for women and a necessity for men that later has been eroded in several countries including India. Individuals who belonged to the LGBTQ+ community are also in a disadvantaged position due to binary conceptions and prejudices. As a result, they also end up paying more.

Physical considerations also contribute to the fact that disability insurance, health insurance, long-term care insurance, and other types of insurance are often more expensive for women. This is because it is expected that women live longer, are more likely to be injured, and are more likely to be carers, all of which are patriarchal prejudices that contribute to the pink tax due to the additional expense.

The price disparity is much more clearly visible in textiles. Women’s t-shirts are comparatively costlier as compared to men though they are made up of the same material and differentially women’s clothes required less raw material as compared to men for the same size.

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FIGURES ARE BASED ON DATA COLLECTED FROM AMAZON 

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In the above illustration, it is clear that for the same size, company, and design women’s ( girls  ) products are charged higher than men’s ( boys ) products by 13.30%.

VARIOUS CAMPAIGNS RAISED AGAINST THE PINK TAX

  • In July 2018, Burger King’s several outlets in Miami, New York, Chicago, and other cities in the US sold a different variety of regular chicken fries to female customers. The quantity was the same as that of a regular box of chicken fries, the only difference was that it was sold in pink packaging and was labeled ‘Chick Fries’. These ‘Chick Fries’ were priced at $3.09 whereas the regular box was priced at $1.69. In order to create awareness among consumers regarding the pink tax a video surfaced on the official account of Twitter highlighting the difference between prices arising due to gender, on the other hand, gender doesn’t have any role to play with food items. 
  •  In 2018, the “Ax the Pink Tax” Campaign was launched by EWC The European Wax Center (EWC), a beauty lifestyle services company to highlight the fact that it has never charged a pink tax from its customers and raised awareness through media partnerships, comedy events and collaborations against this discriminatory policy.
  • #Rethink Pink’- In 2016, Boxed became the first American retail company to reduce the prices of its products in order to ensure equal prices for both men and women. Being a retailer Boxed didn’t have any control over prices but it decided to bear the extra cost for various products like shaving gel, deodorants, body wash, etc. so that both are priced equally.

SOLUTION

Various measures can be taken in order to shed off this pink tax such as –

  • Educating consumers regarding the existence of this hidden tax and the extra burden borne by female consumers for similar quality products in education society can’t get off already existing societal norms.
  • Social Media should be used as an active tool to spread awareness as worldwide people are using social media and it can shrink the entire world into a small global village.
  • Emphasis should be on purchasing Unisex products and manufacturing various genderless products. Government can play a major role by providing various subsidies to companies that deal with and manufactures genderless products.
  • Various campaigns can be launched, and programs can be introduced in schools, colleges, and various other educational institutes so that awareness can be created in the society.

CONCLUSION

Due to the lack of strong legislation against gender-based taxation, economic gender discrimination by means of the pink tax is widely prevalent. Despite women’s products, children’s products are also facing gender discrimination ranging from toys and stationery to clothing and accessories and are also involved despite products being homogeneous in nature. Many countries including India, Australia, and Kenya have already abolished the tax on feminine hygiene products.

Companies should adopt transparent and open pricing policies and should be held accountable for actions taken by them. Various awareness campaigns should be launched to make consumers aware and financial literacy should be declared as a mandate by the government in order to prevent manipulation of prices.

REFERENCES

http://research.monm.edu/mjur/files/2020/02/MJUR-i12-2019-Conference-4-Lafferty.pdf

What is the ‘pink tax’ and how does it hinder women? (n.d.). Retrieved from https://www.weforum.org/agenda/2022/07/what-is-the-pink-tax-and-how-does-it-hinder-women/

https://www.ijern.com/journal/2022/September-2022/02.pdf

https://ijpsl.in/wp-content/uploads/2021/03/UnPinking-Discrimination-Exploring-the-Pink-Tax-and-its-Implications_Svasti-Pant.pdf

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https://kayleighnb.github.io/barnes_pinktax.pdf

Guittar, S. G., Grauerholz, L., Kidder, E. N., Daye, S. D., & McLaughlin, M. (2021). Beyond the Pink Tax: Gender-Based Pricing and Differentiation of Personal Care Products. Gender Issues, 39(1), 1–23. https://doi.org/10.1007/s12147-021-09280-9

Arayakarnkul, P., Chatjuthamard, P., & Treepongkaruna, S. (2022). Board gender diversity, corporate social commitment and sustainability. Corporate Social Responsibility and Environmental Management, 29(5), 1706–1721. https://doi.org/10.1002/csr.2320

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Guittar, S. G., Grauerholz, L., Kidder, E. N., Daye, S. D., & McLaughlin, M. (2021). Beyond the Pink Tax: Gender-Based Pricing and Differentiation of Personal Care Products. Gender Issues, 39(1), 1–23. https://doi.org/10.1007/s12147-021-09280-9

Sanz Espinar, G. (2022). https://riull.ull.es/xmlui/bitstream/handle/915/30978/C_22_%282022%29_28.pdf?sequence=1&isAllowed=y. Çédille, (22), 513–519. https://doi.org/10.25145/j.cedille.2022.22.29

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Lucca, L. M., & Oliveira, M. C. D. N. S. (2022). PINK TAX NO BRASIL. Virtuajus, 6(11), 236–246. https://doi.org/10.5752/p.1678-3425.2021v6n11p236-246

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What is Pink Tax? Meaning & Examples of Pink Tax | Finschool. (n.d.). Retrieved from https://www.5paisa.com/finschool/what-is-pink-tax-meaning-examples-of-pink-tax/

Bhanvi is a Research Intern at IMPRI.

Read more by the author: Strategic Intervention for Green Hydrogen Transition (SIGHT).

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