Women should pay less tax

Women should be taxed at a lower rate than men to help more of them into work and reduce the gender pay gap.

That's the controversial idea floated by two American economists who argue that fiscal "affirmative action" is the best, most practical, way to achieve equilibrium in the workplace.

With around three quarters of American men either in work or looking for work, compared to just six out of 10 women, Alberto Alesina of Harvard University and Andrea Ichina of Bologna University argue that a two-tier tax system would make fiscal as well as moral sense.

"One could obtain more tax revenue with the same average tax rates by reducing the rates on women of a certain amount and increasing that of men by less," they argue.

The small increase in income taxes for men would finance the larger cut in income taxes for women because, as more women chose to work, they'd pay more as a group in income taxes, they argued.

The tax rate for women in the U.S should reduce to 80 per cent of that for men, and possibly even go lower, they suggest.

The rate could vary depending on the gender disparities within each country, they add.

So countries such as Italy and Norway, women's rates would be respectively 68 per cent and 91 per cent of that paid by men.

Single working women would by and large support such a move, they contend.

"Those who were working before gain (assuming that the tax cut is not completely absorbed by lower pre-tax wages), those who chose to work after the tax cut are better off then before because the option of not working is still available but they do not choose it anymore," they say.

Single working men, however, would probably oppose it, while non-working single people would be indifferent.

Married couples in which the woman did not work would probably not be in favour of it but the key group was married couples where the woman worked.

"If every married couple were identical (thus ignoring issues of progressive taxation and different productivities etc) then for every couple the policy is welfare improving since it is welfare improving in the aggregate," they argued.

Other benefits would include allowing men more of a chance to stay at home a little more and see their children, children being given more female working role models and women gaining more power and options.