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"The pink tax isn't an actual government tax; it refers to discriminatory pricing that inflates the cost of goods marketed to women"

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Thomas Barwick/Getty Images

If you've ever seen the same brand of shampoo that's priced several dollars more for women than for men, you may have seen the "pink tax" in action.

The pink tax, or gender-specific pricing on women's goods, contributes to the disproportionate financial burden that U.S. women face at a time when inflation is hiking up prices for many goods.

This financial burden also has disproportionate mental health effects, as 46 percent of women report that money negatively impacts their mental health, compared to 38 percent of men, according to a 2022 Bankrate poll.

This is how the pink tax and other financial burdens affect women across the U.S.

Key pink tax insights

What is the pink tax?

The pink tax isn't an actual government tax; it refers to discriminatory pricing that inflates the cost of goods marketed to women. It can also apply to the practice of inflating costs for women seeking services.

The term "pink tax" was popularized around the mid-1990s, when the Gender Tax Repeal Act of 1995 passed in California, prohibiting price discrimination on services.

The pink tax inflates the price of goods found on retail shelves, and small price differences can add up to women paying more than men over time. The California Senate Committee on Judiciary and Senate Select Committee on Women, Work & Families stated in 2020 that Californian women pay an average of about $2,381 more, for the same goods and services, than men per year. That can add up to about $188,000 in pink tax throughout a woman's life.

The existence and prevalence of the pink tax has been debated in recent years. Many modern discussions of the pink tax reference a 2015 New York City Department of Consumer Affairs study, " From Cradle to Cane: The Cost of Being a Female Consumer," which found that New York City retailers price women's products an average of 7 percent more than similar men's products.

However, a 2021 national study by researchers from the University of Chicago, Booth; Northwestern University, Kellogg; and Cornerstone Research found that women's products were only more expensive than men's in one of six retail categories examined. The study's researchers questioned the need for legislative action against the pink tax.

Discriminatory pricing, when found, can become part of financial inequality that chips away women's purchasing power. Women earn 82 cents for every dollar that a man is paid, according to the Bureau of Labor Statistics (BLS), a statistic that worsens for women of color and other disenfranchised women, according to the U.S. Government Accountability Office. Women are also more likely to feel stressed about their finances than men, Bankrate found in June 2022.

Inflated prices impact consumers of all genders as the U.S. economy faces high inflation. Bankrate polling from December 2022 found that most people (74 percent) are saving less due to economic factors such as inflation/rising prices, rising interest rates or changes in income or employment. This is how that breaks down by gender:

Bankrate asked: When it comes to saving for unexpected expenses, would you say that inflation/rising prices are causing you to save less, save more or not having any impact on how you are saving for unexpected expenses?

Percentage of men

Percentage of women

Source: Bankrate

Women are also likely to spend more, in proportion to their salaries, than men do, as the average single woman pays more in housing, healthcare and apparel and services due to cost of living, family size and other factors, according to BLS data. The average single, adult woman earns $39,178 annually and spends $38,838, as of 2021, compared to the average single, adult man's earnings of $49,525 annually and spending of $41,203.

Factors such as pay gaps, as well as unequal spending and saving, all result in stark wealth inequality between women and men: families headed by women have 55 cents in median wealth for every dollar owned by families headed by men, according to 2021 data from the St. Louis Fed.

Latest legal updates on the Pink Tax

Laws in these U.S. areas explicitly outlaw the pink tax and other price discrimination:

New York State, passed in 2020

California, two laws passed in 1995 and 2023

Miami-Dade County, Florida, passed in 1997

Former New York Governor Andrew Cuomo passed a law banning the pink tax in the state, outlawing retailers, manufacturers and other businesses from charging different prices for two goods that are "substantially similar," but are marketed for different genders. Customers can also receive a written price list from service providers under the law.

California also passed a law in September 2022, which went into effect in January, prohibiting discriminatory pricing. Miami-Dade county in Florida also outlawed charging more for products or services on the basis of gender.

As of February 2023, there have been no federal laws passed against the pink tax. A federal bill, the Pink Tax Repeal Act, has been introduced several times in different iterations since 2016, most recently in 2021, but has never passed.

Pink tax pricing: Gender price differences for goods and services

There's no common percentage difference between products marketed towards women versus men; the New York City Department of Consumer Affairs 2015 study found a wide price difference in similar items, from less than a single percentage difference to as much as 48 percent more for similar items. The study found that women were paying more for many common goods, such as an average of 48 percent more for shampoo and conditioner, 15 percent more for shirts, 13 percent more for girls' helmets and pads, 13 percent more for girls' shirts and 15 percent more for supports and braces, among other price differences.

It's also important to note that different manufacturers package products differently and set different standards of quality, it can be difficult to tell if the pink tax applies to a product you may be buying.

How tariffs influence pricing

The pink tax isn't only impacted by retailer or manufacturer decisions. Tariffs, or taxes imposed on U.S. imports from the federal government, can vary widely depending on the product, though the U.S. tariff is relatively low, according to the U.S. International Trade Commission (USITC).

However, women's products are still sometimes tariffed higher than men's. A 2018 USITC study found that the average applied U.S. tariff on women's apparel was 15 percent, compared to the 12 percent tariff applied to men's clothing. The study showed 66 percent of tariffs placed on apparel affected women's apparel, specifically, and it estimated that women's apparel faces $2.77 billion more in tariffs than men's. Because tariffs are a flat rate, low-income households disproportionally pay more in tariffs compared to their income than high-income households do.

Service costs for men vs. women

Women looking for services like dry cleaning and grooming may face higher prices, just like they might see with products on the shelf.

In 2016, CBS conducted an experiment in New York City, with a female and male producer asking for dry cleaning for a very similar, cotton shirt. CBS found the female producer was charged at least twice as much for the service as her male counterpart.

Services, however, are more difficult to quantify, as not all businesses charge people of different genders differently, and some services targeted to women, such as haircuts, may be more labor-intensive than men's services.

The pink tax and its impact on marginalized groups

Though the pink tax affects anyone purchasing products marketed to women, gender and racial pay gaps mean women of color already walk into a store with less purchasing power than white women. As of 2021, Black women overall earn 63 cents for every dollar a white man earns, while Hispanic women earn 58 cents for every dollar a white man earns, according to the U.S. Government Accountability Office.

Additionally, Black households have a significantly lower median wealth ($24,100, as of 2019) than white households ($189,100, as of 2019), according to the Center for American Progress. They are also more likely to have federal student loans and are more likely to work in lower-paying service jobs, according to the American Association of University Women.

Disabled women earn 67 cents for every dollar a disabled man earns, according to the National Women's Law Center, while elderly women take home a lower average Social Security benefit as a result of lower lifetime earnings, about $18,049 per year as of 2021, compared to the men's average of $22,339.

This sometimes means elderly and disabled women can have a more difficult time affording products affected by the pink tax. Canes were 12 percent more expensive when marketed to women rather than men, the 2015 New York City Department of Consumer Affairs study report found, as were compression socks (4 percent more), adult diapers (2 percent more) and digestive health products (5 percent more).

What to do if you spot price discrimination

If you are in California, New York City or Miami-Dade county, you can report price discrimination to the local government.

If you're located in New York State, you can report price discrimination with the Division of Consumer Protection or with the state attorney general.

In Miami-Dade, you can submit a consumer complaint by email, mail or fax to the county, or by calling the Mediation Center at 786-469-2333.

In California, you can submit a consumer complaint based on the industry to the attorney general.

Bankrate.com commissioned YouGov Plc to conduct the survey on financial wellness. All figures, unless otherwise stated, are from YouGov Plc. The total sample size was 2,457 U.S. adults, including 1,045 who said money has a negative impact on their mental health. Fieldwork was undertaken between April 6 and 8, 2022. The survey was carried out online and meets rigorous quality standards. It employed a nonprobability-based sample using quotas upfront during collection and then a weighting scheme on the back end designed and proven to provide nationally representative results.

Bankrate.com commissioned YouGov Plc to conduct the survey on inflation and pay raises. All figures, unless otherwise stated, are from YouGov Plc. The total sample size was 2,458 U.S. adults. Fieldwork was undertaken between August 17-19, 2022. The survey was carried out online and meets rigorous quality standards. It employed a nonprobability-based sample using quotas upfront during collection and then a weighting scheme on the back end designed and proven to provide nationally representative results.

The study on emergency savings was conducted for Bankrate by SSRS on its Opinion Panel Omnibus platform. The SSRS Opinion Panel Omnibus is a national, twice-per-month, probability-based survey. Interviews were conducted from Dec. 16-19, 2022 among a sample of 1,028 respondents in English (1,003) and Spanish (25). The survey was conducted via web (998) and telephone (30). The margin of error for total respondents is +/-3.5 percentage points at the 95 percent confidence level. All SSRS Omnibus data are weighted to represent the target population.

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The Pink Tax: Latest Updates and Statistics | Bankrate

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From the higher cost of shampoo to clothing, here's how the pink tax drives up prices for women, who already face financial disadvantages.

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"The pink tax often refers to state sales tax on menstrual products, like tampons, and feminine pads"

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Tampon and Condoms Controversy

Tampons and Pads: Tampons and Pads are known to be about $7-15 even though a woman's menstrual cycle is not a choice to have

Condoms: Condoms are free and are easily accessed by schools, clinics, and other organizations

Main Idea: Why aren't female necessities more accessible?

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Although the Pink Tax is unjust—research from the Joint Economic Committee of The United States Congress, ranking democrat Carolyn B. Maloney claims the pink tax factors to consumers goods, services, and Tariffs. The text states, "The higher costs of importing may be passed on to consumers and contribute to the markup on some goods targeted to women..."

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Examples

"The difference in average prices was smallest for children’s clothing (4 percent), and largest for personal care products such as deodorants, body wash and razors (13 percent)"

"Consumer Reports found that in comparing common drugstore purchases such as shaving cream, deodorant and body wash, “products directed at women—through packaging, description or name—might cost up to 50 percent more than similar products for men"

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Carolyn overview the full picture later in the conclusion by stating

"With more information, policymakers can take action to fully reap the benefits of women’s economic power as both breadwinners and consumers."

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Brands involved in Pink Tax including Paired Percentages 

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Brands involved in Pink Tax including Paired Percentages 

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Male Cost: $10

Female Cost: $15

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Male cost: $22-30

Female cost: $35- 60

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Male cost:$5-24

Female cost: $9-30

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Male Cost: $7-10

Female Cost: $6-15

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The pink tax attributed to gender based marketing strategies and societal norms that women are willing to pay more for certain products.

Thoughts: Good for marketing but may have a bad impact

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The people have higher expenses, mainly women. This results in their budgets and limits their purchasing power. This goes beyond pricing but it affects individuals who do not conform to traditional gender norms.

Thoughts: This is like the butterfly effect, the pricing of shipping and materials affects the price the price goes up to the consumer and unequal cost will cause problems.

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The pink tax isn't a federal tax that can affect your income tax refund, but it is a type of price discrimination that impacts millions of women's personal finances and lives each year.

Here's what you need to know.

Pink tax explained

The pink tax often refers to state sales tax on menstrual products, like tampons, and feminine pads. Those feminine hygiene products are necessities for many women. But, many states tax feminine products as luxury items, while exempting other necessities, like groceries and medicine, from sales tax.

And, because men typically don't pay the same high prices for their personal care items (and feminine hygiene products are designed for women), the added cost on feminine and other products marketed to women has been dubbed "the pink tax."

Why pink? Well, pink is the color that is often used by manufacturers to market and brand products that are designed for women.

Examples of the pink tax

The pink tax doesn't only apply to feminine care products. Over the years, advocacy organizations have pointed to different examples of the pink tax that include pricing discrimination involving both goods and services. Some examples include:

higher dry-cleaning or tailoring costs for women's clothing;

higher cost and often smaller sizes of products like women's razors, shampoo, and deodorant, relative to the cost and size of similar personal hygiene products designed for men (e.g., when a pink razor costs more than a similar black, or blue razor); and

higher prices of toys or equipment marketed to girls, like pink bikes, scooters, and helmets costing more than identical red or blue bikes, scooters and helmets.

The period tax (or tampon tax): What is it?

What is the Period Tax? You may also have heard the term "tampon tax." The tampon tax or "period tax" also refers to the sales tax on the already high price of tampons. Like other period products, tampons are frequently taxed as luxury goods, even though millions of menstruating women consider tampons to be necessities.

Pink tax laws

More than twenty states have passed laws dealing with the pink tax. For example, three years ago, New York eliminated the pink tax on certain goods and services. Ohio also eliminated the pink tax back in 2020.

California eliminated the pink tax with services more than a decade ago, and a 2023 state retail law that took effect in January, bans gender-based price discrimination on products. The pink tax ban prohibits California businesses from pricing similar products higher merely because those products are marketed to women.

Virginia, Colorado, Iowa, and Nebraska also recently either eliminated sales tax on feminine hygiene products or reduced state sales taxes on those products.

There is no federal pink tax ban, however. The Pink Tax Repeal Act has been introduced in Congress more than once. However, the legislation has not gained enough votes to move through the U.S. House of Representatives and the U.S. Senate.

What did CVS do with the Pink Tax? CVS pharmacies took steps to help eliminate the pink tax. The pharmacy chain lowered prices on its branded feminine care products. CVS also eliminated sales tax on those products in twelve states where the products were more expensive because of the pink tax.

What is the Tampon Tax Back refund? The "Tampon Tax Back" campaign, launched Oct. 11, allows purchasers in certain states to get a sales tax refund on some feminine hygiene products. The coalition, led by industry brands including August, Cora, Lola, Rael, The Honey Pot, Here We Flo, Saalt, and DIVA, is working to end "tampon taxes" still imposed on period products in 21 states.

How much does the pink tax cost women?

Studies show that gender price discrimination can cost women in practical, physical, and financial ways. Data from the Economic Policy Institute show that women still make about twenty percent less on the dollar than men. Similar numbers from various studies show that women are likely to spend more for necessities like healthcare, clothing, and housing than similarly situated men.

A New York pink tax study found that women's products are, on average, 13% more expensive than similar men's products. As a result, when products that are essential for women (like feminine hygiene products) are taxed as luxury items, that can have a significant financial impact.

High and rising costs of period products have also led to an epidemic of "period poverty"- where an estimated one in four women and girls cannot afford menstrual products. Period poverty affects millions of women, and studies show that struggling to pay for menstrual products or not having those products can damage social, emotional, and menstrual health.

In terms of monetary costs, when California passed its pink tax ban, the state estimated that women paid more than $2,300 for goods and services marketed to them at higher prices than similar goods and services marketed to men. (That comes to about $188,000 over a woman's lifetime and about $47 billion for all of the women in California).

Other data show that women can pay more than $1,300 per year because of the pink tax. According to the nonprofit legal advocacy organization Period Law, the "tampon tax" adds up - to an estimated annual cost to consumers of around $80 million.

Related Content

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Pink Tax: What Does Price Discrimination Cost Women?

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Now is a good time to look at the "pink tax"-gender price discrimination that's banned in many states but costs women millions of dollars each year.

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Bringing awareness of the pink tax can only go so far, although it may damage the company's reputation as long as consumers continue to buy there is no effect. With this in mind, consumer activism is the next step to the solution. Stop buying from corporations that pink tax. As products begin to not be sold companies will lose money and ultimately change prices. Although this is not guaranteed to work so in the next course of action is to take legislative action: ban the pink tax. The banning of pink tax will stop most corporations but some may slip through the laws. With this in mind data collection is critical to keeping track of the continuation of the pink ta. By Keeping track of price ranges and collecting evidence of these illegal actions the punishment for the pink tax ultimately stops the corporation.

These are all solutions to the pink tax.

Although we have brought awareness and had pink tax banned in certain states its still implemented unnoticed.

Thoughts: People need to be aware of the situation to avoid unnecessary spending. It may be a dollar or more but that eventually adds up.

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Trae Bodge, a shopping expert who lives in the New York City area, sees higher prices for products and services marketed to women everywhere: Socks, razors, shampoo and apparel are a few of the product types aimed at women that tend to cost more.

"I don't know why brands think this is acceptable," Bodge says. "It's another punch to the gut as we're trying to manage our budgets right now," she adds, referring to rising prices across consumer goods categories due to inflation.

The phenomenon known as the "pink tax," when products and services aimed at women cost more than their counterparts aimed at men, is well-documented across many goods and services. A 2021 paper co-authored by Stephanie Gonzalez Guittar, assistant professor in the sociology department at Rollins College in Florida, found that women pay more for deodorants and lotions, and that personal care products are increasingly differentiated by gender. For example, lotion for women cost an average of $2.97 per ounce compared to $1.86 for men.

While Equal Pay Day on March 14 focuses on the pay gap between men and women, it can also be a reminder to consider why being a woman so often comes with a higher price tag - and what to do about it.

Here are ways to avoid paying the pink tax.

Opt for gender-neutral products

As Gonzalez Guittar points out, there is no reason why women need to use lavender scents while men stick with pine. Companies also often market multiple products to women - such as separate shampoo, body wash and conditioner - while marketing a three-in-one product to men.

"These are basic hygiene products that don't need to be gendered," she says. Shoppers can save by purchasing more generic or gender-neutral products instead of the gendered versions, she says. "Ultimately, [these products] are pigeon-holing what femininity looks and smells like, and that comes at a price."

Study the fine print

Gonzalez Guittar urges consumers to take a close look at the ingredients and size information on the packaging to help make more informed decisions before they buy.

"Look at the price per ounce, because women's products tend to be smaller," she says, and you can often get a better deal by purchasing unscented products in larger quantities instead. At grocery and drugstores, you can often find the unit pricing on the shelf tag in front of the product.

Comparison shop in advance

Ian Ayres, a professor at Yale Law School, first identified that car dealers often offered the best deals to customers who were white men with research in the 1990s. Follow-up studies since then have affirmed the persistence of discriminatory pricing along with some progress, especially at online and no-haggle dealerships, Ayres adds.

Consumers can help protect themselves by researching car costs to be more informed negotiators and by checking out financing options in advance.

"You can get a competitive interest rate by shopping around and you don't need to go through the dealerships," Ayres says.

Ask for equal pricing

When it comes to services such as dry cleaning or haircuts, men's prices tend to be lower, but Bodge says they don't have to be.

"If I'm having a cotton oxford shirt cleaned, I just ask for the men's option, especially if the pricing is posted," she says. "With haircuts it's trickier, but if you have a short pixie cut, ask for the men's price."

Know your rights

California and New York have passed laws against gender-based pricing, which provides a legal recourse for consumers who notice price discrimination based on gender. You can report violations to the New York State Division of Consumer Protection or the California Department of Consumer Affairs. Other states have proposed similar legislation.

"We have to look at how we push back with legislation. When we think about economic justice, we often only think of equal pay, but that's not the only area where women are experiencing economic injustice," says Christian F. Nunes, president of the National Organization for Women, an advocacy group dedicated to defending women's rights.

"They charge you more, but also underpay you," says Nunes. "It's harder to have a sustainable life."

Prioritize saving

Given the wage gap and women's longer expected lifespans, it's essential for women to amass savings to get through the post-retirement years, says Cindy Hounsell, president of the Women's Institute for a Secure Retirement, a nonprofit that advocates for women's retirement security. "People always say, 'I wish I had saved more,'" she says.

That means leveraging all available work benefits, such as 401(k)s, as well as cutting back on extraneous spending.

"It makes a big difference how you spend your money," she adds. She urges people to use online calculators to figure out how much you will need in retirement so you have a clear goal. "Everyone needs a different amount."

Meanwhile, given the high rates of inflation across many consumer categories, the additional cost of the pink tax only makes it even harder for women to save.

Says Bodge: "It's another hurdle that we need to leap over."

More From NerdWallet This article was written by NerdWallet and was originally published by The Associated Press.

Kimberly Palmer writes for NerdWallet. Email: kpalmer@nerdwallet.com. Twitter: @kimberlypalmer.

The article How to Fight the 'Pink Tax' Amid Inflation originally appeared on NerdWallet.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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How to Fight the 'Pink Tax' Amid Inflation

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Trae Bodge, a shopping expert who lives in the New York City area, sees higher prices for products and services marketed to women everywhere: Socks, razors, shampoo and apparel are a few of the product types aimed at women that tend to cost more. "I don't know why brands think this is acceptable," Bodge says.

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endorsing the different price ranges and spreading awareness of the unjust societal norm.

Pink tax can only go so far due to the GAO admitting to, ”Incorporate additional materials specific to gender-related price difference into their existing consumer education resources''(Samantha Anthony).

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AB-1287 Gender Base Price Discrimination bill guarantees women will gain equal prices banning businesses from assigning women's items higher prices.

The penalty of this bill for “ those who continue to violate this new law could face fines ranging from $10,000 to $100,000 per incident”(CBS8 Staff).

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The final step to this solution is to boycott and set petitions all over.

New Orleans takes action by, “taking their protest to several states as well as a petition, to declare feminine products a necessity…Friday they stopped in New Orleans”(Meg Farris).