In a world that champions equality and justice, it may come as a surprise that there still exists a subtle form of discrimination known as the “Pink Tax”. This is not an actual government tax but rather a term coined to encapsulate the idea that being a woman costs more than being a man due to gender-based pricing of everyday necessities, services, and goods.
Most consumers would likely assume that two products, nearly identical except for to whom they are marketed to, would be priced the same. However, researchers and consumers alike have discovered many instances across multiple categories of goods and services where this is not the case. From clothing and personal care products to services such as dry cleaning, the disparity is apparent even in products aimed at young girls, such as toys, bikes, and athletic gear. A 2015 study conducted by the New York City Department of Consumer Affairs found that women pay more than men for comparable products 42% of the time.
How much does the Pink Tax cost women?
In the New York City Department of Consumer Affairs study mentioned above, researchers found that the price disparity at New York City retailers was on average 7% higher for products targeted at women as opposed to men. These small increases can accumulate, costing women approximately $2,381 per year or $188,000 over one’s life, according to the California Senate Committee on Judiciary and the Senate Select Committee on Women, Work & Families. Pricing disparities within specific categories can vary significantly. For example, personal care items for women such as body wash, deodorant, lotions, and razors can cost up to 13% more than men’s items across similar or identical brands and quality, while haircare products up to 48% more. A quick search of the Levi’s website earlier this year revealed 501® Original Fit jeans priced at $79.50 for men and $108 for women, a $28.50 difference. It has been noted that while some of the price discrepancies can be attributed to higher import taxes on women’s apparel, shoes, and accessories, this practice dates back as far as the mid-1800’s and has no justification today.
The Pink Tax applies to everyday services as well, such as dry cleaning and haircuts. On average, dry cleaning for men’s shirts costs $2.86 versus $4.95 for women. A CBS News report in 2016 spoke to an employee of a dry-cleaning business who attributed this difference to machines and equipment being designed for men’s clothing. The employee acknowledged that women are penalized for being held to a baseline established for men. For the report, CBS News also sent two producers, one male and one female, around to various dry cleaners in New York City with shirts comparable in size, material, and style. In more than half of the businesses, the female was charged at least twice as much.
Here are a few other areas where the Pink Tax is apparent:
Tampons and pads are considered “luxury items” and thus subject to sales tax in some states where necessities like groceries and medications are otherwise exempt.
Women pay up to $7,800 more than men during a typical 8-year period of vehicle ownership. The additional costs can arise from the increased price paid for the car, repairs and servicing, and insurance premiums.
A woman’s haircut can sometimes cost $40 or more than a man’s. While it is arguable that the price difference may be due to the complexity of women’s haircuts, these price discrepancies can exist even when the requested haircut and style is the same.
Pink toys marketed to girls can cost on average 7% more than identical toys marketed to boys. A simple search of the Target website found a red Radio Flyer My 1 st Scooter priced at $24.99 and a nearly identical pink scooter priced at $49.99.
What can we do?
As consumers, women hold more power than they often realize! A change many people can enact
immediately is to adjust their spending habits in the following ways:
- Purchase unscented or generic products
- Buy in bulk and look at the price per ounce of productsShop in the men’s aisle for personal care products such as razors, lotion, and bodywash
- Rent instead of buying special occasion clothing
- Patronize gender-neutral businesses – for example, hair salons that price haircuts based on the
length and thickness of hair rather than the gender of the client
Individuals can also push to eliminate the Pink Tax more directly by reaching out to their Congressional, state, and local representatives and voting. While there currently is no federal law that prohibits discriminatory gender-based import taxes and pricing, individual states and counties have the power to do so – in fact, the practice is already illegal in New York and California, as well as in Miami-Dade County in Florida. Encouragingly, six high school girls in the state of Washington pursued similar legislation earlier this year, however ultimately the bill did not pass.
Efforts to combat the Pink Tax are crucial in the ongoing struggle for gender equality. It persists, in part because it is so deeply ingrained in consumer behavior and marketing strategies that many aren’t even aware of it. Raising awareness about this issue and continued advocacy is essential to effect lasting systemic change.
To learn more about topics that are relevant to women today, we invite you to join us twice yearly at our Vision Capital Women with a Vision events. To be notified of future events, be sure to let your Client Relationship Manager know or check out our monthly newsletter!