Recognizing that gender-based injustice stems from a host of public policy failures—including those related to state revenue collection and spending—the African Tax Administration Forum recently studied 16 African nations’ tax systems to determine whether any are built on policies that aim to reduce gender inequality. ATAF’s conclusion: There is “little evidence that they were developed with any concern for their impact on inequality between the sexes.”
The Addis Tax Institute defines “implicit gender bias” in taxation as facially neutral tax policies that, “due to the gendered patterns of social arrangement, gender pay gaps, and economic behaviour,” generally create worse tax outcomes for women, particularly those with low incomes. Implicit gender bias in personal income tax systems was found in the study to be widespread, particularly because of an insensitivity to taxpayers’ ability to pay.
When personal income tax obligation thresholds start at income levels below the poverty line, women—who are disproportionately low-income on the continent—are hardest hit. Cameroon, Mozambique, and Nigeria, for example, “leave no income untaxed” for individuals. Corporate income tax similarly showed significant gender bias.
The business-attraction conceit underlying the pan-African corporate income tax race to the bottom disfavors women, as does laxity toward multinational corporate tax avoidance, because more businesses are male-owned. The resulting constriction of corporate income tax revenue has led many nations to rely more on consumption taxes, particularly value added taxes on non-luxury goods. ATAF found VATs to be implicitly gender biased because of their inherently regressive nature and high standard rates.
This study was driven by the ATAF Women in Tax Network, which highlights the through-line from tax justice to the United Nations’ fifth sustainable development goal: gender equality. ATAF isn’t alone; the Global Alliance for Tax Justice is another major player in the fight to reverse gendered inequalities in tax on the continent.
South-Led Powerhouse for Gender Tax Justice
While the “developing” and “developed” nation labels of decades past have been largely succeeded by the geographically flexible descriptors “Global South” and “Global North,” some thoughtful—and euphemism-eschewing—activists now prefer analyzing nations as formerly colonized or former colonizers.
GATJ describes itself as “a South-led global coalition” working to build a world where progressive tax policies counteract inequitable policy failures and ensure sufficient public revenue to support “essential services and human rights.” GATJ and its partners call out injustice.
Women disproportionately bear the brunt of tax policy failures; poverty is highly feminized. Policies of austerity and tax burden shifting (wealthy to poor) are normalized; “offshore” tax and regulation dodging are tolerated “while millions around the world struggle to make ends meet.”
Reimagining tax policy through the lens of feminist economics, GATJ calls for “comprehensive progressive taxation, of which wealth taxes are a critical element.” It identifies wealth taxation as “one of the most reliable, fair, accountable and sustainable ways of raising finance to address women’s rights and needs.”
The first volume in GATJ’s Framing Feminist Taxation offers a solid politico-economic framework for use by feminist tax policy advocates around the globe; the second volume provides tools for analyzing gender bias in the tax system and best practices for tax-related human rights advocacy.
GATJ and Tax Justice Network Africa have been among the strongest advocates for moving global tax policy responsibility from the US/EU-centric OECD to the UN, where formerly colonized nations are in a less disadvantaged power position. Late last year, the UN General Assembly resolved unanimously to consider such a move.
Feminists for Wealth Taxes Now
“Feminists for tax justice now!” was the rallying cry last week in New York, when GATJ—along with its regional networks including Tax Justice Network Africa, Red de Justicia Fiscal de América Latina y el Caribe, and Tax and Fiscal Justice Asia—brought together scholars and activists in New York for their annual Global Days of Action on Tax Justice for Women’s Rights during the week that straddles International Women’s Day.
The conference’s framing theme was more specific: “Feminists for wealth taxes now!” Integrating tax justice as part of the broader struggle for women’s rights, Global Days of Action addressed gender tax justice implications of increasing digitalization of the economy (and of tax authorities), “recovery” versus austerity, gendered aspects of wealth taxes, and more.
Converging African and US Perspectives
Last Friday, the Washington, D.C.-based (and US-focused) FACT Coalition hosted a learning exchange featuring two economists who spoke at Global Days of Action—GATJ’s Âurea Mouzinho and Crystal Simeoni of NAWI-Afrifem Macroeconomics Collective—along with Amy Matsui of the US National Women’s Law Center.
FACT’s Ian Gary, who moderated the discussion, opened with a stunning statistic. As of 2020, 252 men held as much wealth as one billion women and girls in Africa, Latin America, and the Caribbean. Industrial scale tax dodging by billionaires and multinational corporations are significant contributors to systemic gender discrimination around the globe, he continued. So what’s to be done?
The panelists agreed that the OECD Inclusive Framework—with its laudable goal of stifling huge multinational corporations’ base erosion and profit shifting activity—is more accurately an “exclusive framework” because formerly colonized countries have been effectively excluded from the Organization for Economic Cooperation and Development’s policy-making process.
They noted the likelihood that the BEPS initiative will transfer tax revenue from previously colonized nations to the former colonizers—a familiar pattern. First, Pillar Two’s global minimum tax rate of 15% is considerably lower than average effective corporate income tax rates across the African continent. Second, resource-rich, and thus extraction industry-dependent, African nations have heavy “source” allocation factors, while former colonizer nations have heavy “market” allocation factors. The OECD framework adopts (surprise, surprise) a market allocation rule.
Siloing Versus Intersectionality
The feminist economist panelists at FACT’s learning exchange that when they speak about gender tax justice, “eyes still glaze over” among some activists and public intellectuals in the broader battle for gender justice. Too many of their colleagues take a topically siloed approach to the subject, ignoring its many essential intersectional connections.
“But that’s changing,” they observed. Those who drive a broad gender justice agenda and those who advance the gender tax agenda may find common ground in analogous struggles in the 20th century—for US civil rights and for African anti-colonial independence. Both gender justice agendas have historical roots in those movements. These words of time-worn challenge—and yet of fresh opportunity—should be familiar to everyone engaged in the struggle:
“Because tax laws have been shaped for most of our nation’s history by a small number of powerful elites, who have been largely white, male, and wealthy, tax laws largely reflect their worldview, values, biases, and experiences.”
This is a regular column from public interest tax policy analyst Don Griswold, who’s also a senior fellow at the Digital Economist. Look for Griswold’s column on Bloomberg Tax, and follow him on LinkedIn.