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Gender equality cannot be achieved without tax reform for multinational companies

We can't achieve gender equality, or ensure women’s rights, without progressive tax policies.

Photo: Hernán Piñera/Flickr. (CC BY-SA 2.0). Some rights reserved. Domestic and care work responsibilities fall disproportionately on women. Photo: Hernán Piñera/Flickr. (CC BY-SA 2.0). Some rights reserved. Women’s organisations in developing countries can be proud of themselves. Thanks to their struggles, more states have adopted laws to promote gender equality at work. Overall, women have greater access to their own incomes, more of us are working, and the gender gap in the quality of employment is narrowing slightly.

Nevertheless, pay gaps still exist between women and men doing the same work. Women are disproportionately represented in informal jobs and jobs without decent working conditions including living wages, maternity leave, or pensions. In Africa and Asia, UN Women found that 75% of women’s work is currently in the informal sector.

Women continue to carry disproportionate housework and unpaid care responsibilities. Looking after dependent family members, cleaning and cooking are still ‘women’s affairs’ in many places, limiting opportunities for education, training and paid work, making true economic empowerment impossible.

Today, there is renewed commitment to gender equality and human rights at the international level, including through the UN’s 2013 sustainable development agenda. But this clashes with local political realities in many places, with governments implementing harsh austerity policies with devastating consequences for unprotected populations.

'Governments are implementing harsh austerity policies with devastating consequences for unprotected populations.'

At the same time, the general public is increasingly aware that many multinational companies only pay a portion of the taxes they owe (as revealed yet again by the Paradise Papers scandal), leaving governments with fewer public resources.

What seems to have most surprised citizens is that many corporate tax abuses are legal. Companies can legally declare profits not where they are made, but in other countries with lower – even zero – tax rates. This perpetuates tax competition, pressuring countries into levying increasingly lower taxes.

Less well-known is how this system limits progress on women’s rights and gender equality – which cannot be achieved without tax reform for multinational companies.

Tax policies impact women and men differently, due to their different and unequal positions as workers, carers, consumers, and owners of assets. These policies may thus promote, or impede, gender equality progress.

'Tax policies may promote, or impede, gender equality progress.'

When multinationals do not pay the taxes that they owe, states have fewer resources to invest in public services such as education, healthcare, childcare, justice systems and public drinking water and sanitation systems.

This can exacerbate gender equality due to women’s disproportionate participation in precarious or low-paid jobs. When social services are cut, women tend to take on more unpaid care work. Closing a school may force a woman to quit her job to care for her children.

Furthermore, when governments see their abilities to raise revenues diminished – due to multinationals not paying their full, far share of tax – they tend to compensate for this loss by increasing the tax burden on small and medium-sized business or on citizens and families (generally by increasing sales taxes, for example value-added tax – VAT).

Such measures also have a gender dimension, as women are overrepresented in small and medium-sized business and at the lowest wage levels. The more regressive the tax system, the more the burden of sustaining public policies will fall on the shoulders of women.

Whenever governments make or reiterate commitments to gender equality and women’s rights, we must remind them that we cannot achieve these goals without progressive tax policies.

About the author

Magdalena Sepúlveda is a member of theˆIndependent Commission for the Reform of International Corporate Taxation (ICRICT). Previously she was the United Nations special rapporteur on extreme poverty and human rights. In 2015, Magdalena was recognised among the Global Tax 50, a list of individuals and organisations with the greatest impact on tax policy and practice worldwide.


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