PINK TAXES AND GENDER
BASED TAXATION IN
Okereke Happiness Ngozi
What is GENDER-BASED TAXATION?
Gender bias reflects in taxes which treat men and women differently. This discrimination can be
explicit or implicit.
• Explicit forms of gender bias are to be found in tax provisions which treat men and women
• Implicit discrimination occurs when gender neutral tax provisions interact with socio-economic
realities that affect women.
What are PINK TAXES?
Pink taxes are additional costs of products and services specifically targeted at women.
Pink taxes are not strictly taxes since they are not levied by governments but by producers who
charge more for female products compared to similar male products of the same quality and
Any tax system involves the taking of decisions which affect men and women
differently. These decisions are taken over a long period and reflect social attitudes
about the respective roles of men and women.
Gender bias in taxation can be found in both soft laws and hard laws.
• Fiscal policy decisions affect women because they interact with socio-economic
realities that may produce gender differentiated outcomes.
• In addition to soft laws, hard laws such as legislation have been used by some
countries in the EU in a number of bold attempts to address gender gaps in
employment, income, poverty and wealth.
SOCIO ECONOMIC REALITIES THAT AFFECT WOMEN
Tax rules that explicitly discriminate against women are hard to come by as most countries have
abolished these rules. Tax rules may interact with existing socio-economic realities which already
treat men and women differently. Some of these socio-economic realities are:
Low Labour Force Participation: Nigeria has one of the lowest rates of employed women, as percent of
total population in the world. Only 67% of women compared to 99.2% of men aged 45 to 49 years (the highest
employed age bracket) are employed. The overall labour force participation rate was 65.1% compared to the
male labour participation rate at 71.4%
Income Distribution: Statistics on the earning difference between men and women in Nigeria is scarce. Men
are employed in more higher paying jobs and women are mostly secondary earners
Wealth Distribution: Women have less access to financial assets, property and inheritances. In Nigeria,
female inheritance in Nigeria is hampered by customs that prohibit female inheritance
Poverty: Nigeria has overtaken India as the country with the largest number of people living in extreme
poverty. The risk of poverty differs for men and women across age groups, but the gender gap in poverty is
widest for older women who are widowed or living alone.
Gender Aspects of Taxation
The 1999 Constitution provides that a citizen shall not be discriminated against by reason of sex, religion,
political opinion etc.
The Convention on the Elimination of Discrimination against Women (CEDAW) condemns discrimination against
women in all forms. Although it does not explicitly mention taxation, all government policies are required to
comply with its provisions.
Apart from being unjust or unfair, gender discrimination is economically inefficient because it lowers output
per capita. Discrimination prevents the equalisation of marginal rates of substitution in production. Women
may be the ones paid lower but gender discrimination also lowers the entire economy’s total output.
Gender aspects of taxation can be found in every kind of tax:
Personal Income Taxation
Gender aspects of taxation are mostly visible in personal income taxation because personal income covers all
kinds of personal income regardless of sources. S. 3 of PITA covers profit or gain from trade or business,
salaries and wages, capital incomes (interests, dividends and capital gains), transfer incomes ( pensions) and
• Global Tax vs Schedular Tax vs Flat Rate Tax
In a Global tax system, a progressive income tax schedule is applied to all incomes received from all sources.
Flat rate systems tax all kinds of income at relatively flat rates.
Under a schedular tax system, Income from different sources are charged in separate schedules. Capital income is
taxed at a moderately flat rate while labour income is subject to progressive income tax schedules. This obtains in
Nigeria where dividend and interest income are taxed at a flat rate of 10% and other income is charged at the
progressive rates: First 300,000 @ 7%, Next 300,000 at 11%, next 500,000 at 15%, next 500,000 at 19%, next
1,600,000 at 21% and above 3,200,000 at 24%.
Capital incomes correlate with wealth which more men have. The redistributive quality of a progressive income tax
is weakened. A schedular or dual system of tax as above will only accentuate the differences between men and
• Joint Tax Provisions
In the past, the tendency was to structure taxation around family-based income tax systems. Today, joint tax
provisions with a gender aspect include those with family based tax reliefs or child tax credits. Transferrable tax
relief between partners or spouses are absent in Nigerian tax laws hence discrimination against single parent
families or secondary earners does not arise.
Tax planning on a family basis is however limited in Nigeria.
• Child Care Costs
Female employment and intra-household distribution of work are also influenced by childcare
costs, which can be seen as an indirect tax on female employment. The absence of tax relief for child care costs
reflect a gender bias of not considering that a double earner family will have to purchase child care like any other
good or service.
In Nigerian families, an ‘inactive’ partner will be required to do this as part of unpaid work in a single earner
Tax exemptions for childcare costs reduce the costs of taking up employment as well as the costs of extending hours
worked by secondary earners and thus support in particular employment by mothers.
Property Taxation and Taxes on Wealth
The major gender aspect of property taxes is hinged on the attribution of ownership and income from jointly owned
property to men. Unless the spouse is able to provide convincing proof of a direct and substantial contribution to
the purchase of the property, there will be no joint ownership.
The owner or occupier of property must be determined by the usual common law rules relating to the ownership pf
If property is bought in the name of the wife, there is a presumption of advancement even if the husband did not
intend the property as a gift.
Taxation of inheritance is absent in Nigeria.
Although consumption taxes do not show explicit bias since they are levied on the purchase of commodities without
particular reference to gender. Yet consumption taxes can reflect implicit gender bias. It can be argued that
consumption taxes affect women more since they form the larger proportion of the population with lowest incomes.
Women are more likely than men to spend a higher proportion of their income on purchase of basic goods and
Hence although VAT is a broad base consumption tax compared to excise tax or custom duties, yet the consumption
pattern of a gender can reflect implicit gender bias of VAT.
Nigeria currently taxes women and
Young girls for having a period.
Under the VAT Act, female hygiene products are not exempted under the First Schedule to the Act since they
neither constitute medical and pharmaceutical products or baby product.
The FIRS circular No 9701 lists sanitary towels and tampon napkins for babies as VAT exempt. There is a need for a
clear amendment of the VAT Act to remove this ambiguity and make sanitary pads which are as basic as can be, VAT
Recommendations and Conclusions
Efforts and considerations must be made by policy makers to achieve gender neutral tax laws. Yet, it must be
acknowledged that intended gender neutral laws may produce gender differentiated outcomes due to their
interaction with socioeconomic realities.
Gender bias may be positive.
• Singapore’s tax system is unique in the nature of explicit gender differentiation it builds into the income tax in
the form of child relief. A basic child relief is available. In addition, a married woman is entitled to additional
allowances for children if she has elected to be charged to tax in her own name. She must have passed at least
three subjects in one sitting at the examinations for the General Certificate of Education or obtained an
equivalent or higher educational qualification. This is clearly a positively discriminatory provision to encourage
married women to have children.
• The Tampon tax used to call attention to the fact that tampons and other female hygiene products ate subject to
VAT. The exclusion of VAT by including it expressly among the exemptions in the First Schedule to the VAT Act.
Women should not be taxed for a biological necessity.