The Pink Tax: Economic Gender Discrimination

A white gift bag with pink text reading "Ax the Pink Tax", a pink calculator, and other items
A view of the gift bag during the European Wax Center + Refinery29: Ax The Pink Tax.

Monica Schipper/Getty Images

The pink tax, often called a form of economic gender discrimination, refers to the higher prices paid by women for certain products and services also used by men. In the case of many everyday products, such as razors, soap, and shampoo, the only differences between the men’s and women’s versions are the packaging and the price. While the individual price differences are rarely more than a few cents, the cumulative effect of the pink tax can cost women thousands of dollars over their lifetimes.

Key Takeaways: The Pink Tax

  • The pink tax refers to the higher prices paid by women for identical products and services as those purchased by men.
  • The effect of the pink tax is most often seen in personal care products such as toiletries and razors, and services like haircuts and dry cleaning.
  • The pink tax effect is often criticized as a form of economic gender discrimination.
  • The pink tax has been estimated to cost women as much as $80,000 over their lifetimes.
  • There are currently no federal laws prohibiting the pink tax. 

Definition, Impact, and Causes

Unlike the equally controversial tampon tax—the failure to exempt feminine hygiene products from state and local sales taxes like other necessities—the pink tax is not a “tax.” Instead, it refers to the widespread tendency of products or services marketed exclusively toward women to carry a slightly higher retail price than similar or identical products or services marketed for men.

The quintessential example of the pink tax can be seen in the inexpensive single-blade razors sold by the millions in thousands of stores nationwide. While the only difference in the men’s and women’s versions of the razors is their color—pink for women and blue for men— the women's razor costs around $1.00 each while men’s razors cost about 80 cents each. 

Economic Impact

The effect of the “nickel-and-dime” pink tax applies to items purchased by women from childhood through older adulthood and can have a pronounced, even if unnoticed, impact.

Illustrative photograph showing the harmful effect of the pink tax on women’s finances.
Illustrative photograph showing the harmful effect of the pink tax on women’s finances. Torpoint, Cornwall, United Kingdom/Getty Images

For example, a 2015 study comparing nearly 800 products with clear male and female versions conducted by the New York City Department of Consumer Affairs found that women’s products cost 7% more on average than similar products for men—up to 13% more for personal care products. As a result, a 30-year-old woman more will have already paid at least $40,000 in pink taxes. A 60-year-old woman will have paid over $80,000 in fees not paid by men. There are currently no federal laws banning businesses from charging different prices for similar products based on the purchaser’s gender or sexual orientation.

Causes

The most obvious causes of the pink tax price discrepancy are product differentiation and the phenomenon of price elasticity.

Product differentiation is the process advertisers use to distinguish one product from other similar products in hopes of making it more attractive to a particular demographic target market—like men vs. women. Typical ways of creating product differentiation include gender-specific styling and packaging.

Price elasticity is simply a measurement of how much consumers are willing to pay for a given product. Consumers who value a product’s quality, styling, durability, etc. over its price alone are said to be “price elastic,” and thus more likely to accept higher prices. Many marketers believe that women tend to be more price elastic in making buying decisions than men.

Criticism and Justification 

The most vocal critics of the pink tax call it a blatant and costly form of gender-based economic discrimination. Others argue that it marginalizes and demeans women by assuming that they are so easily influenced by marketing that they will continue to buy higher-priced but otherwise identical products marketed as being for men. 

Many marketers, however, contend that the female-male pricing disparity is a result of market forces rather than discrimination. Women, they argue, as highly knowledgeable consumers, will buy the more expensive “pink” product because they find it more useful or aesthetically pleasing than the “blue” men’s version. 

In an April 2018 report on the pink tax, the Government Accountability Office (GAO) told Congress that while gender-based price discrepancies exist, “whether the price differences are due to gender bias is unclear.” Instead, the GAO cited evidence showing that some price differences could be due to variations in the cost of producing advertising and packaging, and were thus not discriminatory.

Looking at specific toiletries, the GAO found that prices for half of the personal care items they examined, including deodorants and fragrances, were higher for women, while some men’s items like non-disposable razors and shaving gels cost more.

The GAO further reported that the three independent federal agencies tasked with investigating complaints of economic discrimination (the Bureau of Consumer Financial Protection, the Federal Trade Commission, and the Department of Housing and Urban Development) investigated “limited consumer complaints about gender-related price differences” from 2012 through 2017.

Is Price Discrimination Illegal?

Though it almost certainly existed before then, the pink tax was first recognized as an issue in 1995 when the California state legislature’s Office of Research reported finding that 64% of stores in the state’s five large cities charged more to wash and dry clean a woman’s blouse compared to a man’s button-up shirt. A senior consultant to Democratic Assemblywoman Jackie Speier told newspapers that the discrepancies represented “blatant examples of price discrimination based upon gender.”

Based on the study, California enacted the state-wide Gender Tax Repeal Act of 1995, which says, in part, that “No business establishment of any kind whatsoever may discriminate, with respect to the price charged for services of similar or like kind, against a person because of the person’s gender.” However, California’s law currently applies only to services, not to consumer products.

After being elected to the U.S. House of Representatives in 2013, Rep. Speier introduced the Pink Tax Repeal Act prohibiting “product manufacturers or service providers from selling substantially similar products at different prices based on the gender of the intended purchaser. After the bill failed to gain traction, Rep. Speier reintroduced the pink tax ban in April 2019, but no further action has been taken on the bill.

Leading the opposition to the Pink Tax Repeal Act, retailers and manufacturers of women’s products and clothing argue that it would be difficult to enforce and result in an onslaught of lawsuits. They further contend that since the causes of the difference between men’s and women’s products are not always clear, enforcement of the law would be arbitrary and subjective. Finally, they contend that a widespread reduction in prices of women’s products would be harmful to American manufacturers and lead to employee layoffs.

Sources and Further Reference

  • de Blasio, Bill. “From Cradle to Cane: The Cost of Being A Female Consumer.” NYC Consumer Affairs, December 2015, https://www1.nyc.gov/assets/dca/downloads/pdf/partners/Study-of-Gender-Pricing-in-NYC.pdf.
  • Shaw, Hollie. “‘Pink tax’ has women paying 43% more for their toiletries than men.” Financial Post, Apr 26, 2016, https://financialpost.com/news/retail-marketing/pink-tax-means-women-are-paying-43-more-for-their-toiletries-than-men.
  • Wakeman, Jessica. “Pink Tax: The Real Cost of Gender-Based Pricing.” Healthline, https://www.healthline.com/health/the-real-cost-of-pink-tax.
  • Ngabirano, Anne-Marcelle. “’Pink Tax’ forces women to pay more than men.” USA Today, March 27, 2017, https://www.usatoday.com/story/money/business/2017/03/27/pink-tax-forces-women-pay-more-than-men/99462846/.
  • Brown, Elizabeth Nolan. “The ‘Pink Tax’ Is a Myth.” Reason, Jan. 15, 2016, https://reason.com/2016/01/05/the-pink-tax-is-a-myth/.
Format
mla apa chicago
Your Citation
Longley, Robert. "The Pink Tax: Economic Gender Discrimination." ThoughtCo, Aug. 17, 2021, thoughtco.com/pink-tax-economic-gender-discrimination-5112643. Longley, Robert. (2021, August 17). The Pink Tax: Economic Gender Discrimination. Retrieved from https://www.thoughtco.com/pink-tax-economic-gender-discrimination-5112643 Longley, Robert. "The Pink Tax: Economic Gender Discrimination." ThoughtCo. https://www.thoughtco.com/pink-tax-economic-gender-discrimination-5112643 (accessed September 20, 2021).