Gender Based Taxation

My initial response to the idea that women should pay lower tax rates than men was skeptical. But Sara liked it, so I read more. It's certainly intriguing. Some responses to critics are available here. Download the paper (PDF) by Alberto Alesio et. al. to learn more. The abstract:

Gender Based Taxation (GBT) satisfies Ramsey’s optimal criterion by taxing less the more elastic labor supply of (married) women. This holds when different elasticities between men and women are taken as exogenous and primitive. But in this paper we also explore differences in gender elasticities which emerge endogenously in a model in which spouses bargain over the allocation of home duties. GBT changes spouses’ implicit bargaining power and induces a more balanced allocation of house work and working opportunities between males and females. Because of decreasing returns to specialization in home and market work, social welfare improves by taxing conditional on gender. When income sharing within the family is substantial, both spouses may gain from GBT.

Probably not a realistic option.

Comments

But Sara liked it, so I read more.

Writing that sentence: mistake.

Posted by SomeCallMeTim | February 18, 2008 10:51 AM

See also Taxing Women.

Posted by J-Dub | February 18, 2008 10:53 AM

Good thing we didn't pass that Equal Rights Amendment, huh? That would have totally stalled this wonderful idea.

Posted by southpaw | February 18, 2008 10:53 AM

I have to assume this only applies to married couples.

But this is a good example of stupid intervention on the part of liberals. Normally, I take the view that government's have such a strong influence regardless, one specific policy does not represent additional influence. But here I have to take exception. Introducing a law with unknown consequences, which is going to be widely perceived as unfair is just not a good idea. Sure, women will start working more. But this also financially encourages hiring childcare services. That is not a work-life balance the state should be subsidizing. On the balance, it's better for the actual parents to do the childcare. So this cuts both ways.

Posted by mpowell | February 18, 2008 11:01 AM

"On the balance, it's better for the actual parents to do the childcare."

Don't open that can of worms!

Posted by Klug | February 18, 2008 11:04 AM

Sounds like an idea that Susan Okin could get behind.

Posted by BrianZ | February 18, 2008 11:08 AM

The constitutionality of this provision is dubious, at best.

Posted by Alex Knapp | February 18, 2008 11:10 AM

No wonder the Republicans do so well with their "No new taxes" mantra.

Keep it up, Matthew. The Democrats will loose the election yet.

Posted by Duncan Kinder | February 18, 2008 11:16 AM

Sounds like it would be pretty unfair to unmarried men.

The constitutionality of this provision is dubious, at best.

Since we never passed the ERA, it would be totally constitutional.

Posted by example | February 18, 2008 11:17 AM

A few years ago there was a big flap when someone proposed taxing men more because they were responsible for all the crime, etc. that caused public expenditures. You can imagine how far that idea got.
My favorite response was from someone who pointed out that the American approach would be to sue their manufacturers instead, i.e. their mothers.

Posted by peter | February 18, 2008 11:24 AM

We should tax by height, too. I seem to remember skimming a funny Greg Mankiw paper along those lines a while back.

Seriously, we need to stay the hell away from taxing people based on anything else BUT income. Not to go all Jonah Goldberg, but anyone who thinks "Gender Based Taxation" is a good idea needs to stay far away from any real source of power in this country.

Posted by Korha | February 18, 2008 11:41 AM

Since we never passed the ERA, it would be totally constitutional.

I'm no ERA-ologist, but as I understand it one of the main problems in the ERA ratification debates was that the ERA-proponents basically granted that existing jurisprudence of the 14th amendment etc did in fact provide remedies for gender discrimination for the same range of practices (or all but unisex toilets etc) that the ERA would address. So - to put the claim at its weakest - it's not at all clear that "Since we never passed the ERA, it would be totally constitutional".

Posted by otto | February 18, 2008 11:51 AM

Sure that this wasn't an extended piece of snark written by a tax specialist?

(Read Bastiat and his "Petition from the Candlemakers" to see what I mean.)

Posted by grumpy realist | February 18, 2008 11:57 AM

Since we never passed the ERA, it would be totally constitutional.

As Otto points out, the 14th Amendment already provides for equal protection under law.

It hasn't always been applied to sex discrimination with the same force as it has to racial discrimination, so that the ERA would in fact have worked some change in the law.

However, anything as blunt as "people with penises pay higher taxes" would pretty spectacularly fail the test of constitutionality.

Posted by Anderson | February 18, 2008 12:07 PM

Cause: But Sara liked it
Effect: so I read more. It's certainly intriguing.

Example,

Tthe Courts have slowly moved down the road to finding the rights the ERA protected already in the Constitution.

To summarize Equal Protection analysis, Courts are most protective of "suspect" classifications (i.e. government discrimination the basis of national origin, ethnicity or religion). This "heightened scrutiny" requires that the law be narrowly tailored to serve a compelling state interest, basically kill any law that discriminates on the basis a suspect classification. Though in the age of terrorist screenings and racial profiling, perhaps the courts are less vigilant than they used to be.

Most regulations and laws, of course, don't favor or disfavor any "suspect" classification (or any other immutable characteristic), the court's lenient "rational basis"standard requires only that the law be reasonably related to a legitimate government interest.

There are two groups that are immutable characteristics but are not suspect classifications-- those are gender and legitimacy.
For those categories, the courts have an intermediate scrutiny test, a law must be substantially related to an important government interest.

Its under this last standard that a lot of gender equality case law has been made, so much so, its difficult to see what the Equal Rights Amendment would add to the picture.

Under intermediate scrutiny (and I trust the ERA as well, were it on the books), the government can still draft men and not women and allow the use of segregated bathrooms (maybe our grandchildren will be shocked that there were men-only and women-only bathrooms, but I doubt it). However, I doubt any court would allow gender-based taxation, it would lose on both "important government interest" (allocation of house work and working opportunities?) and on "substantially related" (decreasing returns of specialization?).

Posted by beowulf | February 18, 2008 12:15 PM

What about homosexual couples? Lesbian households deserve a lower tax burden than homosexual males?

Posted by Michael | February 18, 2008 12:17 PM

Don't married, one-income families get a huge tax break by virtue of the larger thresholds for the marginal tax rates?

I make between $30k and $60k so my marginal tax rate is 25%. If I get married to someone who doesn't work, my tax rate drops to 15% because the bump to 25% now occurs at $60k. Even if my spouse works, this amounts to a $3k tax break up until combined income crosses $60k, at which point it decreases and may eventually go negative. Where it hits the break-even point I guess depends on how income is distributed between the two of us.

The bump to 28% doesn't occur until $124k. Cry me a river.

Posted by Matt B | February 18, 2008 12:18 PM

Lmao, this is immoral and evil. I don't know who this Sara person is, but I sure as hell hope she never had any desire to hold public office, or even an appointed one.

don't you all know, in feminist land men don't really count as anything but a punching bag? Women get to have sex toys, but men having sex toys makes us evil and gross. Women get to insult men, but if men having any latent hostility left over from their own relationships is misogyny. Unmarried women are proud and independent, unmarried men are pathetic losers.

They also don't care about gay (non-lesbian) people, women of color, or any woman who makes less than 100k a year. And they wonder why they can't even get a majority of women to side with them.

Posted by Soullite | February 18, 2008 12:32 PM

Sara is full of shit.

Taxation based on anatomy -- o.k., if you insist, on one's chosen gender -- makes about as much sense as basing the right to vote on genitalia or skin color.

Tell that she-dog to get a grip or no more milkbones.
(Dogs, by the way, have indeed earned their tax break).

Sara's argument implies that female humans deserve a break for the same reason domestic pets do. Sorry, sugar pie, but that hound won't hunt.

Seems to me to be the identical flavor of entitlement that says men are duty-bound to put the toilet seat down after urinating because, well, because what? females are too delicate to do it themselves? and big, strong men are more capable of hefting the toilet seat up when nature calls? Right on, sister! Now tell me another one.

Posted by teknozen | February 18, 2008 12:44 PM

Two words: gender reassignment.

Now we can find out how serious wingnuts really are about cutting their taxes...

Posted by Just Jake | February 18, 2008 1:18 PM

But Sara liked it, so I read more.

So does all of this ultra-feminism actually get you laid or what?

Posted by jim | February 18, 2008 1:23 PM

Jeebus, what's with all the misogyny on the thread? (It's like an Obama supporters' convention with all the misogyny here.) The guy's girlfriend recommended he read something she found interesting, so he read it. Isn't this, like, normal in a relationship? My wife finds something interesting, I tend to read it, since I often find interesting the same things she does. What do you do when your significant other recommends you read something?

As to the substance, without having read the full paper, I'd take issue with he idea that we ought to encourage "a more balanced allocation of house work and working opportunities between males and females". Why?

Posted by Al | February 18, 2008 1:53 PM

LoL, I don't trust people who try to turn their significant others into clones of themselves.

If we have a more balanced houseload, I don't just want 'ooportunities' balanced for women. I want them to HAVE to work 40+hours a week at a soul-killing job. That's equality. It's not equality if I HAVE to work and you get to CHOOSE to work. It's not equality if I HAVE to help around the house, but you don't HAVE to help make money.

Posted by Soullite | February 18, 2008 2:38 PM

“Jeebus, what's with all the misogyny on the thread?”

It doesn't take much. Sexism is alive and well on the left; it's not just the province of the right.

Posted by Keith M Ellis | February 18, 2008 2:45 PM

“Writing that sentence: mistake.“

Only because of sexism. Had Yglesias been referring to a man, there would have been no fuss. If it had been Sal, his roommate...fine. His father? Fine. Most telling, if Yglesias had been female and it was Sal, her husband...it would have been fine.

It's only the specter of Yglesias being unduly influenced by the sweet nether-parts of his silly little feminist girlfriend that upsets anyone.

And fuck you to the asshole who made the quip about being a feminist to get laid.

Posted by Keith M Ellis | February 18, 2008 2:50 PM

This is a classic argument between efficiency and equity that we expect to compromise on in our society.

A few years ago the Wall Street Journal Editorial Page was touting a study that analyzed the most efficient structure of a multi-rate income tax. People with high incomes can afford to shift income to future years, shift wages to capital income, hold income in corporate benefit accounts, and reduce their efforts in response to higher rates. Poor people need all the income they can get, so they will work as hard or harder in response to rising rates. The result was a proposal that people earning minimum wage should be taxed at a 50% rate and millionaires should be taxed at less than 10%.

That proposal was efficient but not equitable. A more equitable approach would be rising rates based on income with poor people paying almost no taxes and rich people paying more since they can afford more.

Our current system taxes middle class and rich people at about the same rates once all taxes are added in, with a slight favoritism for the very rich. Poor people pay the highest proportion of income as taxes, mostly because they don't vote reliably rather than by plan. Our current system is a compromise between equity and efficiency.

Taxing women less than men is described as efficient by the study above. That may be so. But if we consider that women live longer, richer, strongly socially favored lives in spite of doing much less work compared to the average man we may consider an equity argument that men should be taxed less.

Or we could compromise and just treat men and women the same.

Posted by Brian | February 18, 2008 3:04 PM

Jesus Christ, this is the stupidest fucking thing I've ever seen. If Democrats started backing this we would be in Iraq for 100 years.

Posted by David | February 18, 2008 4:28 PM

Lmao, personally I'm fully willing to believe that Yglesias is the kind of guy to find this to be perfectly acceptable without any coaxing by a female at all.

But don't ever pretend any of us isn't influences by our significant others. That's just not realistic or honest. We are ALL influenced by our emotions and our instincts, and that is never going to change. It's not even regrettable, clearly it's an instinct that has brought us this far.

Posted by soullite | February 18, 2008 4:35 PM

Nothing will get white men's attention faster than than the perception of reverse *ism. This will be no exception. DOA.

Posted by sherifffruitfly | February 18, 2008 9:14 PM

Increasingly, married working women are making more than their partners. Full disclosure: I am a woman who works more and makes more than her husband. We do not yet have children.

Enacting this would ensure an unfair tax break for us. It wouldn't do a thing to ensure my hubby does more around the house. I didn't read the paper, but exactly how is this supposed to be a social good? There might be an economic good because I could afford to pay a housekeeper and create a job but a social good? No.

Posted by Chaos | February 19, 2008 10:58 AM

In my early years teaching in California, eons ago, women had to pay more into the retirement system than men. The justification was that they had a longer life expectancy. It took the courts to get rid of that one.

Posted by Nora | February 19, 2008 11:19 AM

I didn't read the paper, but exactly how is this supposed to be a social good?

From the abstract:

Gender Based Taxation (GBT) satisfies Ramsey’s optimal criterion
by taxing less the more elastic labor supply of (married) women. This
holds when different elasticities between men and women are taken as
exogenous and primitive. But in this paper we also explore differences
in gender elasticities which emerge endogenously in a model in which
spouses bargain over the allocation of home duties. GBT changes
spouses’ implicit bargaining power and induces a more balanced allocation
of house work and working opportunities between males and
females. Because of decreasing returns to specialization in home and
market work, social welfare improves by taxing conditional on gender.
When income sharing within the family is substantial, both spouses
may gain from GBT.

Posted by Barbar | February 19, 2008 11:28 AM