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The “Pink Tax” Really is a Tax

February 04, 2016

pile of shirts

 

Many news outlets have reported on the “pink tax,” the higher prices charged for items targeted for women compared to similar items packaged for men.  Dr. Lori Taylor, an economist and director of the Mosbacher Institute for Trade, Economics and Public Policy at the Bush School of Government and Public Service at Texas A&M University, says that at least in part, it really is a tax.

In a recent issue of The Takeaway, Taylor and her co-author, Jawad Dar, describe how US tariff rates on most articles of imported apparel and footwear are classified by the gender of the intended user; and for many items, the rates differ. For some gender-classified goods, the tariff is higher on menswear; for some, lower; and for some, there is no difference. But overall, Taylor and Dar have calculated that the tariffs paid on imported clothing are higher for women than for men.  The tariff on women’s silk shirts, for example, is six times the tariff on men’s silk shirts. In other words, some of the pink tax comes from actual tax policy.

In “Fairer Trade: Removing Gender Bias in US Import Taxes,” the authors argue that tariffs, in general, hurt competition and lead to higher prices; that gender-based tariffs have a discriminatory impact on consumers; and that tariffs on apparel and footwear harm American consumers. They offer a few solutions, including eliminating the tariffs altogether, and strongly maintain that differential taxation of apparel based on gender cannot be defended and should be abolished.

The Takeaway is a publication of the Mosbacher Institute for Trade, Economics, and Public Policy. The full text of the article can be found at http://bush.tamu.edu/mosbacher/takeaway/V6-3%20Tariff%20Discrimination%20Takeaway.pdf.

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