The Gender Gap Series: Tampons - That Bloody Sales Tax : The Indicator from Planet Money Most states in the U.S. have a sales tax on menstrual products. Some states have repealed this so-called Tampon Tax, on the grounds that it's unfair to women. But the repeals come at a cost.
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The Gender Gap Series: Tampons - That Bloody Sales Tax

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The Gender Gap Series: Tampons - That Bloody Sales Tax

The Gender Gap Series: Tampons - That Bloody Sales Tax

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STACEY VANEK SMITH, HOST:

Hey, everybody. We are back with another episode in our series The Gender Gap. This whole week, we're taking another look at some of our favorite stories about women and the economy. In the last three episodes, we have explored how much women earn, work and invest relative to men. But today, we take a look at how much women pay for stuff relative to men.

(SOUNDBITE OF MUSIC)

CONSTANZA GALLARDO, HOST:

So, Stacey.

VANEK SMITH: Yeah.

GALLARDO: In Spanish, we have this phrase.

VANEK SMITH: Yeah.

GALLARDO: It's (speaking Spanish), which...

VANEK SMITH: What does that mean?

GALLARDO: ...In English, is, I got a visit from Andres (ph), the one that comes every month, which is really creepy.

VANEK SMITH: Wait. Is this like a visit from your Aunt Flo, except, in Spanish, Aunt Flo is a man...

GALLARDO: Yes, exactly.

VANEK SMITH: ...Named Andres?

(LAUGHTER)

GALLARDO: Yeah.

VANEK SMITH: What did he do?

GALLARDO: I don't know who Andres is...

VANEK SMITH: Who is this guy?

GALLARDO: ...Or why we did that.

VANEK SMITH: Somebody is pissed at Andres...

GALLARDO: Exactly.

VANEK SMITH: ...I would say.

GALLARDO: Exactly. But anyway, so Aunt Flo in America?

VANEK SMITH: Aunt Flo, yeah. It was like a visit from Aunt Flo, yeah - your period. You got your period.

GALLARDO: Yeah, your period.

VANEK SMITH: It's happening, yeah.

GALLARDO: Exactly.

VANEK SMITH: There is no reason for us to be squeamish, right? I mean, literally more than half the planet deals with it.

GALLARDO: For, like, 40 years of their lives.

VANEK SMITH: Yeah. And, of course, you know, to deal with our very natural friend Andres, we need equipment, right? You got to have tampons and pads and menstrual cups or other things to, like, get through the day. And tampons are a lot. It's, like, 10 bucks, 12 bucks for a box of 20.

GALLARDO: And here's the thing. These products are subject to sales tax, which might not sound like a big thing. You know, we pay sales tax for other things as well. But many products similar to tampons or health-related items have a medical tax exception - things like dandruff shampoo, aspirin, foot powder and condoms.

VANEK SMITH: And so, you know, understandably, a lot of people say that's not fair. If you're going to give condoms and aspirin and foot powder tax exemptions, tampons should have a tax exemption, too. This is THE INDICATOR FROM PLANET MONEY. I'm Stacey Vanek Smith.

GALLARDO: And I'm Constanza Gallardo. Today on the show, ending the tampon tax. How much does it cost women? And what is the cost to ending it?

(SOUNDBITE OF HANNAH KING'S "DUST & BONES")

VANEK SMITH: Sales tax - most people in this country pay sales tax on most of the things they buy. It's a big source of state revenue - has been ever since the Great Depression. And each state, of course, chooses what its sales tax will be and some of the products that will have a sales tax. Some items, like food or water, that are seen as, like, necessary to survival are not subject to this tax.

GALLARDO: Prescription and nonprescription drugs are also exempt - medicines like aspirin, DayQuil or Viagra, also medical equipment and supplies, which can be things like ChapStick or gauze.

VANEK SMITH: ChapStick is tax-exempt?

GALLARDO: Yup.

VANEK SMITH: That's interesting. But you know, Constanza, what does not fall into the medical supply category in many states - most states?

GALLARDO: Tampons.

VANEK SMITH: Tampons, exactly.

GALLARDO: Yeah.

VANEK SMITH: Also, pads and cups and all of the menstrual hygiene products. And this is where the term tampon tax began.

ZOE SALZMAN: This is a matter of personal health and also public health, really. And yet, because it's a women's health issue, it is instantly politicized.

GALLARDO: That's Zoe Salzman. Back in 2016, she filed a lawsuit in New York to eliminate the sales tax on menstrual products.

VANEK SMITH: Zoe Salzman and her team argued these products are necessary for women, and they should be tax-exempt.

SALZMAN: Then there were medical supplies, which are defined as supplies used in the cure, mitigation, treatment or prevention of illnesses or disease. Again, that's really broad.

And one example the Department of Tax gave was things like bandages, gauze and dressings. And so those are items that are used to staunch the flow of blood from the human body. And tampons and pads, as well as cups and panty liners - those are used to staunch the flow of blood from the uterus. So again, clearly, you know, these items have to fit within that definition.

VANEK SMITH: Zoe made her case, and the New York legislature took notice and, in fact, passed a bill back in 2016 to exempt feminine products in New York from sales tax. So that extra cost here in New York, Constanza, we do not pay it anymore.

GALLARDO: Yeah. But many other women in other states do pay it. And a study published this year by the American College of Obstetricians and Gynecologists found that 2 out of 3 low-income women in the U.S. couldn't afford menstrual products at least once a year, and nearly half of them struggled to buy both food and menstrual hygiene products over the last year.

SALZMAN: Where you really are budgeting down to the dollar every month, that makes a big difference. Those women also tend to buy these products in smaller sizes and smaller packages and in places like convenience stores, where the prices are usually higher. So all of that compounds to really make a really direct impact on their budget.

GALLARDO: In fact, there's economic research that the tax break on tampons really benefits low-income people. That's based on consumer data after New Jersey's tampon tax was repealed back in 2005. Research showed that by eliminating the tax, it made products cheaper and more accessible to lower-income women.

VANEK SMITH: But some people say the tampon tax needs to stay.

NICOLE KAEDING: But in general, I think that the sales tax is really one of the best ways for a state to raise revenue.

VANEK SMITH: This is Nicole Kaeding, the vice president of federal projects at the Tax Foundation, a think tank that studies tax policy. She says picking and choosing products to be taxed or not taxed is problematic for a lot of reasons. First of all, it can mean less money for states. They won't have enough money to fund public policies or the programs they want to fund. And it can also mean that states have to increase other types of taxes to get that funding back. So if the sales tax applies to fewer products, the sales tax on the products that are left goes up.

GALLARDO: Nicole thinks an easy way to fix this issue is by having a sales tax on everything - no exemptions - which, by the way, that can lower the overall tax rate for every product, including tampons.

KAEDING: So when you start moving into these - this world of exemptions, you start adding complexity because you have to define what is and is not a qualified good under the exemption. You know, in my view, a state would be much better off to have a broad sales tax that applies to, you know, all final consumption. You avoid these sorts of, you know, picking between different product classes. It would make for a much more efficient sales tax.

GALLARDO: Back in 2016, California Governor Jerry Brown vetoed a bill that planned to eliminate the state's tampon tax. He argued that by not taxing menstrual products, California could lose up to $20 million in annual taxes.

VANEK SMITH: And the governor has a point. Here in New York, where we eliminated a tax on menstrual products, we're losing about $14 million a year in lost tax revenue.

Of course, this isn't just an economic issue. It's a political issue, too. Last year, for example, Nevada voted to make menstrual products tax-exempt.

GALLARDO: Nicole also expects more states to push for legislation and pass bills that would repeal the tampon tax this year, like Michigan, Georgia and Ohio.

VANEK SMITH: And, of course, California is looking at the issue yet again. Andres is coming to town.

(LAUGHTER)

GALLARDO: We have two big developments. California and Rhode Island passed a budget package that exempts tampons and menstruation products from state sales tax.

VANEK SMITH: It's worth pointing out that these tax exemptions could be changed in future budgets. But for now, the women in California and Rhode Island will get a little tax break on their tampons.

GALLARDO: And, Stacey, I have a fun, little update for you as well.

VANEK SMITH: OK.

GALLARDO: Remember Andres?

VANEK SMITH: How could I forget Andres?

(LAUGHTER)

GALLARDO: Well, it's definitely not the weirdest euphemism out there for your menstruation (laughter).

VANEK SMITH: OK.

GALLARDO: There's actually over 5,000 different ones all over the world.

VANEK SMITH: Wow.

GALLARDO: So if you have a really weird or funny one...

VANEK SMITH: Oh, yeah, send them along.

GALLARDO: Send them along. Instagram us or send us an email. We would love to read them.

(SOUNDBITE OF MUSIC)

GALLARDO: Today's update was produced by Rachel Cohn. Our original episode was produced by me. And our editor is Paddy Hirsch. Our current intern is Emily Lang. And THE INDICATOR is a production of NPR.

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