Equal rights, unequal import tariffs: how women pay the price

Trade is often hailed as a catalyst for promoting gender equality, but its potential to do so has limitations. Trade policies, including import tariffs, can affect men and women differently due to gender-differentiated socio-economic roles and responsibilities. Despite the prevalent use of gender-neutral language, trade policies have demonstrated disproportionate impacts on women, thus leading to so-called “pink tariffs”.

But why do import tariffs disproportionately affect women? While several factors must be considered, legal barriers holding women back in trade contribute to gender-specific impacts of customs duties.  Women, Business and the Law dataset offers valuable information on legal discrimination in economic opportunities, serving as a catalyst for necessary reforms in both legal and trade policies. 

How Women Bear a Greater Burden of Import Tariffs: Insights from Two Case Studies

Consumer Impact: As the main consumers of essential household items that heavily rely on imported products, women are particularly affected by customs duties. Especially, highly taxed agricultural products, such as staple foods, affect women more as they spend a high share of their income on feeding their families. Furthermore, customs duties are particularly high for products essential to women, like hygiene items and reproductive health goods. These goods are subject to significantly higher tariffs in several countries like the Bahamas (30%), Djibouti (26%), and Mexico (15%) compared to the global average tariff rates of 12% for sanitary products and 2% for reproductive health goods.

Gendered Tariffs in Clothing: Several economies still establish different import tariffs for men’s and women’s similar clothing items. For example, women’s bathrobes and tracksuits are taxed between 12% to 13% more than men's in countries like Botswana, Eswatini, Namibia, and South Africa. Over the years, increased efforts have been made to reduce both clothing tariffs and gender bias custom duties. Figure 1 shows the comparability of clothing tariffs for both genders in most economies, despite remaining disparities.

Figure 1: MFN import tariffs on women’s and men’s clothing since 1996, worldwide

Source: Authors calculations based on Tariffs Download Facility (World Trade Organization). Tariffs averages considered are those in chapter 61 (HS 6101 to 6117) and chapter 62 (HS 6201 to 6217). The labels “Women’s apparel” and “Men’s apparel” correspond to the products explicitly described as intended for women or men. The label “Gender-neutral apparel” corresponds to products whose description does not include gender language. 

Women in Production and Sector-Specific Tariffs: Women as producers also face higher tariff barriers than men due to occupational gender segregation. Especially, women are more concentrated in agriculture and industries related to food, beverages, and textiles, which face higher customs duties and input taxes. The high share of low-paid workers,  which may distort competition in the domestic market, is among the main motivations for high import tariffs in female-dominated sectors.

What’s more, a comparison between tariffs and legal restrictions on employment mapped and analyzed by Women, Business and the Law shows that women face more restrictions to work in sectors with low tariffs. For instance, agricultural products are subject to average customs duties exceeding 15%, while women face job restrictions in agriculture in a limited number of economies (Figure 2). In contrast, male-dominated sectors, such as mining and energy, face low tariff rates of about 6%,  but women are limited or directly prohibited from working in mining in 54 economies and in energy in 21 economies, hindering their ability to take advantage of these lower tariff rates.

Legal reforms targeting the removal of women’s employment restrictions could not only mitigate gender occupational segregation but also encourage greater market liberalization in female-dominated sectors. This is supported by a recent study in Bangladesh, which reveals how gender-based occupational segregation drives women in highly taxed agricultural production, consequently leading to worse employment and income inequality.

Figure 2: Women’s Employment Restrictions Compared to MFN Tariffs by Industry in 2022

Source: Authors calculations based on WTO Stats (World Trade Organization) and Women, Business and the Law 2023 database (World Bank).

Policy Interventions to Close the Gender Data Gap in Trade Policies: Next Steps

International trade law, including WTO agreements and preferential trade agreements, do not address gender-based discrimination in tariff barriers–they only address discrimination based on product origin (Articles I and II of the GATT). Attempts to legally challenge gender disparities in import tariffs in the United States, such as in the Rack Room Shoes v. United States 2013 and Totes-Isotoner Corp. v. United States 2010 cases, were unsuccessful.

To address gender disparities in trade, policy interventions are critical. This includes boosting women’s participation in fields like STEM, which are traditionally male dominated but face lower import tariffs.  World Bank initiatives like the Trade Facilitation Support Program can also help women exporters gain a stronger foothold in sectors with lower import tariffs. Data analysis is also essential to gain a better understanding of how import tariffs affect women’s employment, wages, access to resources, and export capacity. The “Women and Trade: The Role of Trade in Promoting Gender Equality” and Women, Business and the Law serve as valuable tools for analyzing the linkages between women’s legal rights and gendered trade dynamics. An upcoming research paper using the Women, Business and the Law dataset sheds light on legal barriers preventing gender equality in export activities , highlighting the significance of similar research efforts for import tariffs.

Overall, while trade can be a catalyst for promoting gender equality, the current structure of trade policy instruments often perpetuates gender disparities. This underscores the need for legal reforms and policy interventions to ensure that trade does not exacerbate gender inequality.

The authors would like to thank Julia Constanze Braunmiller and Nadia Rocha for their insightful comments. Support for the work was provided by the United States Agency for International Development (USAID).