The pink tax phenomenon: She comes with a hefty price tag!

Through the years we have observed a myriad of unjust gender centric norms, stereotypes and conventions bite the dust. Even so, the “y chromosome” has incessantly managed to tip the scale on the obvious side. Sadly, gender-based discrimination keeps presenting itself in a new avatar and women have to keep paddling their own canoe. The “Pink Tax” is not a novel face of gender-based discrimination yet widely unfamiliar. Let’s address the Pink Tax, shall we?

The alleged predilection towards pink is how the term came to be coined. Pink is a colour that has a universal association with the female gender. The term "pink tax" is a misnomer in the sense that it does not in a majority of cases take the form of conventional taxes. In plain terms, Pink Tax is the unfair cost of being a woman. It refers to the additional money payable as a result of gender-based price discrimination, often on pink products, a colour that is literally and figuratively known to represents women and girls. The phenomenon has exploded over the decades and has finally claimed the spotlight, albeit not in a desirous way. Irrespective of the tax policies that prevail in different jurisdictions, the product market evolved in a way that fostered the propensity to sell it to women with a hefty price tag. Gradually, products marketed specifically towards women grew more expensive than those marketed for men, even though they were identical or had minuscule differences or simply because they were pink in colour.

The New York City Department of Consumer Affairs (“DCA”) published a study on Gender Pricing in New York City, From Cradle to Cane: The Cost of Being a Female Consumer in 2015. They conducted a detailed analysis to estimate the gender-based price differentiation between analogous goods sold to men and women. Their study concluded that women's products bear an excess cost of 7% on average compared to the corresponding male-marketed alternatives, often without any rationale. Female care products which cost 13% more have by far borne the highest premium. Specifically, the pricing on their hair care products that cost 48% more, is anything but just and reasonable. Compared to boys, clothing items and toys for girls cost 4% and 7% more respectively. These discrepancies have long surpassed the age factor.

The Pink Tax has also managed to dissolve the compartmentalized “goods” bracket and has steadily seeped into “services” such as dry cleaning, laundry, hair salons and car deals. There is no justification as to why women pay 27% more for getting an identical basic white cotton shirt laundered. In 1994, the State of California studied the issue of gender-based pricing of services and estimated that women effectively paid an annual “gender tax” of approximately $1,351 for the same services as men. Furthermore, a 2016 ParseHub study analyzed 3,191 personal care products in Canada and revealed that women's personal care essentials cost 43% more than analogous male products. The study estimated that while men are paying $282 annually for personal care products, an average Canadian female consumer is paying $497. The cost keeps increasing exponentially with each passing year.

One can argue that price disparities are a result of a varied choice of ingredients, manufacturing upgrades that are better suited for women, the desirable enhancements in the appearance of products, branding, product differentiation and marketing amongst others. However, an individual purchaser exercises no control over these choices. Product price differences based on gender are inescapable for female consumers purely due to the product offerings in the market. Inevitably, a woman's purchasing power is of little consequence. These staggeringly high retail prices are predetermined by retailers and not by manufacturers. Often, price differences between certain analogous products have no nexus to the production cost whatsoever. The price disparity is achieved by tempting and lucrative marketing strategies that are deceptively smart and convincing. The Pink Tax more than recovers the fortune spent on marketing and advertising. Even though price differences may arise due to legitimate factors, by what margin can these price differences be allowed as “reasonable”?

“Parsimony” and "Improvidence” are not gender-based traits. However, profligate tendencies have conveniently been attributed to women who are thought to be less price elastic than men. These contrived business considerations and assumptions have dictated the graph of price sensitivity for women consumers and the corresponding monetary advantage reaped by marketers. The most unsettling about the Pink Tax is the lack of any economic justification for gender-based price discrimination. Marketers view women as less price elastic than men i.e. price variations and inflations do not deter women from buying products or availing services.

The Pink Tax has majorly contributed to period poverty and has left women grappling for access to basic hygiene essentials at an affordable rate. Pain killer tablets for periods cost more than regular pain-relieving medications, though they are composed of the same active ingredient. Fortunately, several countries have successfully abolished or reduced the unjust tax on tampons, sanitary pads, and other feminine hygiene products that are non-luxury necessities. After rigorous campaigning and protests, India in 2018 scrapped the 12% tax on tampons and sanitary pads. In November 2020, the Scottish Parliament unanimously enacted the Period Products (Free Provision) (Scotland) Act. It has made Scotland the first nation in the world to pass landmark legislation which makes period products free and accessible for those in need. This legislation is a significant feat for women in their battle against gender inequality.

Several studies, reports, and research on the Pink Tax fostered a dialogue for the enactment of legislation about gender pricing laws. “Gender Tax Repeal Act of 1995” sought to prohibit gender-based price discrimination in services. New York, California, Massachusetts, Washington D.C., and several other jurisdictions have enacted legislation to protect consumers from gender price discrimination for services. Congresswoman Jackie Speier, a member of the California State Senate has played a pivotal role in combating the pink tax issue. Over the past two decades, she introduced several bills to abolish the pink tax and the gender tax. The proposed Pink Tax Repeal Act was introduced multiple times in various Congress sessions, namely, in July 2016, April 2018, and April 2019. Although, the proposal included a ban on gender-based price discrimination for both goods and services, the law that was enacted only covered services under its purview.

In New York, Governor Andrew Cuomo’s proposed ‘Pink Tax Ban’ was successfully implemented in October 2020. Governor Cuomo said, "By abolishing the pink tax, women and girls will no longer be subject to harmful and unfair price discrimination and any businesses who fail to put an end to this despicable practice will be held accountable." The proposed ban was a crucial component of ‘2020 Women’s Agenda in the FY 2021 Budget. Under this ban, businesses are prohibited from differently pricing “substantially similar” consumer goods or services based on gender, violation of which will attract substantial civil penalties. Although, this is an issue of gender-based discrimination, "consumers” and “retailers” are the real classes in conflict. Consumers, both men and women, shell out money to buy female products. It is pertinent to note that the money is ultimately pocketed by marketers and retailers who are the only beneficiaries in this transaction.

The economic impact of the pink tax is unforgiving and ruthless, especially against the backdrop of the gender earnings gap that has put women to a massive disadvantage, consequently robbing women of their purchasing power. It is only fair to mention that men are also subjected to gender-based price discrimination, but to a significantly lesser degree than women. While their products cost more 18 % of the time, women's products cost more 42 % of the time. Substantially high remuneration coupled with the availability of economical products and affordable services for men has given them a greater hold on the buying power, thereby causing a stark imbalance in economic equality. The price differentiation has escalated to unreasonable proportions in no time, and much faster than the rate at which the wage gap should be closing.

While women are given alternatives of evading pink tax, addressing and resolving the issue is paramount and indispensable. Buying generic products is a temporary solution to a permanent problem. Acceptable alternatives will cease to be viable in the fullness of time. Social dialogue is our greatest weapon today. While supporting Gender Neutral Pricing Companies, we must create an atmosphere that compels the government to aid us in our battle against the pink tax. As of today, the general direction of progress appears to be promising. With awareness and effort, victory is inevitable.

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