Taxing better to create more caring—and feminist—societies

International Women’s Day falls in the shadow of a pandemic which has hit women hard around the world.

In the United States, it was the vice-president, Kamala Harris, who sounded the alarm—pointing out that 2.5 million American women had left the workforce since the beginning of the pandemic. ‘Our economy cannot fully recover unless women can participate fully. So I believe, I think we all believe, this is a national emergency,’ she hammered away in a video call with several women’s advocacy groups and lawmakers, calling for a national plan to address the situation.

The progress of Covid-19 vaccinations in the US gives hope for a rapid recovery of the economy. But a report from McKinsey Global found that women, comprising 43 per cent of the workforce, accounted for 56 per cent of pandemic-related job losses—women without college education and women of colour yet more disproportionately affected. 

Harris’ cri du coeur should be extended to the whole world. Everywhere, there are women whom the pandemic has pushed out of the labour force. This will have a knock-on effect: while women live longer than men, the gender gap in security in retirement will only increase.

Larger burden

Even for those women still in the labour market, their situation has deteriorated. Social isolation has narrowed their options to escape contexts of domestic abuse. And most are now shouldering a much larger burden of unpaid domestic duties than men.

Lockdown has only added to household work, with women taking care of most virus prevention, looking after their families’ health and juggling new safety and hygiene protocols. They have also taken on primary responsibility for homeschooling children, as well as caring for the sick and the elderly. 

More than ever, the pandemic has made evident the unequal sharing of unpaid care and domestic work, and the lack of value and recognition attached to it. This constrains women’s progress in education and training and hinders their access to, and advancement in, the labour market—and so to its economic opportunities and entrepreneurial activities—resulting in gaps in pay, social protection and pensions. 

The prospects for the next generation are no more reassuring, as school closures have disrupted learning outcomes for 1.7 billion children worldwide, as well as their nutrition, health and safety. Save the Children warns that millions of girls are at risk of not being able to return to school after the pandemic. And there will be another scar—13 million more child marriages by 2030 than would have been the case without Covid-19. 

This is the scourge of the pandemic: it is landing multiple blows on those least able to bear them, widening inequalities stemming from gender, class and ethnicity. As the world marks International Women’s Day, this is neither acceptable nor inevitable.

Deplorable conditions

All over the world, populations have been forced to become aware of the vital importance of public services, such as universal healthcare, childcare, adult social care, education and water and sanitation. Those who have been providing vital work during the pandemic are predominantly women but the working conditions of most of them are deplorable. 

Women have been the first to pay the price of decades of budget cuts and privatisation of essential services. Governments urgently need to make immediate yet long-term corrections—to invest in public services, social protection and infrastructure, in pursuit of gender equality and women’s full enjoyment of their human rights. 

All these much-needed measures obviously have a cost, so who will pay for them? ICRICT, a commission engaged in reforming the international tax system in a fair and equitable way, has offered an answer: it is time for those who have the most to pay the most. 

As a recent Oxfam report shows, rich people are getting richer, despite the pandemic. The world’s 10 richest billionaires—all men, unsurprisingly—have seen their wealth skyrocket by half a trillion dollars since March 2020. That is more than enough to prevent anyone on the planet from falling into poverty because of the virus and to pay for a Covid-19 vaccine for all.

Turning point

This pandemic must mark a turning point in the taxation of the richest individuals. It is also a unique opportunity really to address corporate-tax dodging and put an end to corporate-tax competition.

We have a solution at hand, through the introduction of a minimum effective corporate-tax rate of 25 per cent worldwide. Any multinational that books its profits in a tax haven would therefore be taxed in its home country up to this minimum rate. This would reduce its interest in transferring its profits to these unscrupulous jurisdictions.

Utopian as of just a few weeks ago, this measure now seems possible. The new US administration has committed itself to ‘try to stop what has been a destructive, global race to the bottom on corporate taxation’, as the US Treasury secretary, Janet Yellen, put it at her confirmation hearing. 

Other countries must move in the same direction. An international reform to make multinationals and the richest pay their fair share of taxes requires a global agreement. It is essential that these negotiations take place in the most transparent and egalitarian way, ideally within the United Nations—the only legitimate forum for these exchanges.

Generating more revenues to invest in measures essential to ensure women’s rights and gender equality depends on progressive and fair tax systems. Today, more than ever, taxing the richest members of our societies will put us on the path to becoming more caring societies.

Which also means societies that put women’s rights at their core.

See all articles of our series on the role of women in the coronavirus economic crisis