Gender Bias Affects Cost of Imports, Says Texas A&M Bush School Scholar

April 15, 2015

Tariff Takeaway Cover

Women looking for bargains probably won’t find them at Customs. The burden of tariffs falls heavily—and in many cases exclusively—on the consumer.  So when the tariff on women’s leather shoes is higher than the tariff on men’s leather shoes (which it is), women feel the pain, says Dr. Lori Taylor, an associate professor at the Bush School of Government and Public Service at Texas A&M University.

Taylor, who directs the Mosbacher Institute for Trade, Economics and Public Policy at the Bush School, and Jawad Dar, a graduate research assistant, say that in many cases, there is no difference in the tariff for men’s goods and women’s goods.  However, in a surprising number of cases, there are large differences.

“The tariff on women’s silk shirts, for example, is six times the tariff on men’s silk shirts,” Taylor says.  “And our research has shown that the average tariff rate for women’s apparel is systematically higher than the average tariff rate for men’s apparel.”

On average, the tax on imported clothing for men is 11.9 percent while the tax on imported clothing for women is 15.1 percent, or more than 3 percentage points higher. Taylor and Dar have calculated that in 2014, buyers of imported clothing and footwear paid at least $330 million more in taxes than they would have paid had there been no gender-based tariffs.  And because higher tariffs lead to higher prices for domestically produced goods, the actual burden of the tariffs was even greater, so just buying goods manufactured in the US won’t solve the problem, says Taylor.

“Prices are set in a global marketplace and are unlikely to change just because the United States imposes a tariff.  If the world price is $20 and the US tariff rate is 10 percent, then the US consumer pays $22, regardless of whether the item was manufactured at home or abroad.  Either way, American consumers overpay.  And when the tariff is higher for women’s goods than it is for menswear, American women really overpay,” she added.

Taylor and Dar say that overcoming the gender bias in the tariff code could be relatively simple.  “Congress could simply declare that importers have the option of paying either the men’s or women’s tariff rate, whichever is lower. Or, even better, Congress could eliminate tariffs on clothing and footwear altogether.  That would be a very fair bargain for consumers,” she added.

A complete report on Taylor’s and Dar’s research on removing gender bias in US import taxes can be found in a “Takeaway” publication on the Institute’s website, http://bush.tamu.edu/mosbacher/.

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