By
Tom Odhiambo
Title: Taxation and Gender Equity: A Comparative Analysis of Direct and Indirect Taxes in Developing and Developed Countries; Editor(s): Caren Grown and Imraan Valodia; Publisher(s): Routledge, IDRC 2010-06-10; Pages: 352; Language: English
The editors of the book Taxation and Gender Equity are quite explicit from the beginning about why they bothered to study the gendered nature of tax and taxation but also why it is important to consider the question of how women and men pay tax.
In the introduction, they write, “Drawing on a three-year eight-country study Taxation and Gender Equity outlines why gender equity advocates need to interrogate the revenue side of public finances, and why tax analysts and policymakers should carefully consider the gender impacts of tax policies and tax reforms.’
In other words, although a rarely discussed subject, evidence has tended to show that women and men pay tax differently. And this is a worthy subject to consider when dealing with the question of revenue collection and taxation, especially in Africa.
But why should we be bothered about the differences between the tax burden of women compared to that of men?
After all, every human being pays some tax at one time or another. More accurately, why would anyone wish to read the book Taxation and Gender Equity: A Comparative Analysis of Direct and Indirect Taxes in Developing and Developed Countries (Routledge, 2010) edited by Caren Grown and Imran Valodia?
Because how, when and where women and men pay tax often differs carrying with it hidden gender bias in the taxation of women compared to men.
In the first chapter of the book, the author notes that among key factors to consider in the study of gender and taxation, and which informs research in Taxation and Gender Equity, include what has been described as “‘stylized facts’ about gender differences in economic activity that should be used to understand the impact of taxation on men and women.
They note that these facts are: “gender differences in paid employment – including formal/informal employment, wages and occupational segregation; women’s work in the unpaid care economy; gender differences in consumption expenditure; and gender differences in property rights and asset ownership.”
Taxation and Gender Equity seeks to provoke a nuanced debate on how gender differences; employment or lack of it; (unfair) or different pay structures; general distribution of income; household expenditures; taxation models, among other factors, affect women compared to men when it comes to paying tax.
If one cuts out the jargon and its seeming academic tone, this book should be a general reader among advocates of gender equity and tax justice, policymakers, politicians, bureaucrats, tax experts, or even the public.
For the questions it poses tend to appear on the margins of public debate on earnings/income and taxation.
Yet these questions are quite urgent. For instance, how should a family that depends on a single earner of income be taxed?
Here it may be worth considering that the gender of the family head and of that single breadwinner matters – men may most likely find regular pay for work; women may only manage to work for irregular pay as social demands of caregiving may not allow them to work longer and regularly.
How much tax does such a family pay considering that it may have a higher household expenditure, especially if there are many children and other dependants? Here, considering the age of the children as a factor in consumption; and the fact that some of the children may not add much to the unpaid household labour.
What could be the differences in the tax paid if we compare the tax as paid by a household headed by a man to that headed by a woman?
Taxation and Gender Equity offers quite interesting propositions in discussing the implication of gender differences for income generation, the primary tax burden for the individual, the explicit tax paid and the hidden taxes etc.
Take the question of work – finding employment; the type of work; the compensation; the tax paid on the compensation; the explicit and implicit biases in personal income tax burden etc.
What are the differences in the experiences of women and men when they look for work? Do women face similar obstacles to finding work as men? What do the differences in the compensation for women and men imply for their tax obligations?
The answers to these questions seem obvious but they are complicated, depending on the society one is studying or the culture one is investigating or the work in question.
Women are generally disadvantaged when it comes to finding work. They are generally less skilled and least qualified because of lack of or poor access to education. They are likely to be the caregivers at home. They may be forced by marriage or childbearing to give up work and depend on men, or relatives, or charity, or the government.
All these facts have implications for the personal income tax that a woman pays compared to a man. Staying at home means one significantly reduces their chance of finding work or networking with those who could connect them to work opportunities. Yet the individual will still pay taxes when they have to pay for goods and services that are taxed.
But even when work is available, women are likely to receive less compensation than men. This is a historical, cultural and almost ‘normalized’ practice the world over. It doesn’t matter whether one is considering developed or developing economies.
Research shows that women will somehow be paid less and are likely to spend more at home and on themselves compared to men. Food, clothes, medical care, schooling, among other needs for children or the household are the concerns of women.
This situation implies that even employed women who are paid well but who have children and dependants at home will suffer more taxation on their income than their male counterparts.
Or, think of the rural-urban divide, which has major economic implications for women compared to men. In most African countries, women still stay at home (in the village) whilst men travel to look for work (towns and cities).
Although the men may be taxed directly and indirectly on income earned, whatever money they send home to their wives (and mothers) is subject to a series of taxes. They may be taxed by the money transfer service provider – on behalf of the tax authority; they will be taxed on goods they buy –VAT; and they may end up paying for several other local taxes.
Yet, even if the woman in the village works on the farm and is able to earn some income, the land and any revenue generated thereof may still be registered in the name of the man. Such a situation is worsened in cases where the marriage isn’t ‘official’.
In other words, the woman may create wealth, for which she will be taxed, but the wealth will benefit the man, who has the official authority to transact in it or even transfer it.
To speak about the implications of gender differences on revenue and taxation, and the biases – obvious and hidden – that often saddle women with a higher tax burden compared to men, is to suggest a more careful relook at policy and laws that determine tax collection.
Gender equality is not just a matter of politics and of adding up numbers. It is a question of constant revisiting of the processes by which we make laws, asking all the time if the laws are sensitive to gender differences, and creating awareness in all institutions on how to address the likely deficits in the legislation and policies dealing with taxation, especially where women are concerned.
This, in the end, is the moral argument of Taxation and Gender Equity.
The writer teaches literature at the University of Nairobi. He writes on tax because he pays tax. He can be contacted at tom.odhiambo@uonbi.ac.ke or +254720009155
