Ilomata International Journal of Tax & Accounting P-ISSN: 2714-9838.
E-ISSN: 2714-9846
Volume 5.
Issue 3.
July 2024 Page No.
Gender-Based Taxation: Comparative Lessons for Indonesia from Singapore.
The United States, and Nepal Qowiya Hasna Naury1.
Vissia Dewi Haptari2 Politeknik Keuangan Negara STAN.
Indonesia Correspondent: vissiadewih@pknstan.
Received : May 28, 2024 Accepted : July 10, 2024 Published : July 31, 2024 Citation: Naury.
Haptari.
Gender-Based Taxation: Comparative Lessons for Indonesia from Singapore.
The United States, and Nepal.
Ilomata International Journal of Tax and Accounting, 5.
, 681-691.
https://doi.
org/10.
61194/ijtc.
ABSTRACT: This paper examines the implementation of tax policies that are in line with gender based taxation in Singapore, the United States and Nepal as well as policy recommendations that can be implemented in Indonesia through qualitative methods using literature studies and regulatory reviews.
The discussion approached in several working women, corporate participation, caregiver, domestic work support, pink tax, women-owned businesses, widows, and taxation for families.
In which this paper finds that Singapore.
Nepal, and the United States have implemented a series of policies that create a more welcoming ecosystem for women to participate in economic activities, which Indonesia can use as an example in designing Gender Based Taxation in the future.
Keywords: Gender-Based Taxation.
Gender.
GenderInequality.
Working Woman This is an open access article under the CC-BY 4.
0 license.
INTRODUCTION
Indonesia's "Vision 2045," outlined in the National Long-Term Development Plan (RPJPN) 20252045, aims to transform the nation into a sovereign, advanced, and sustainable archipelago.
primary goal is to elevate per capita income to a comparable level along developed countries, projecting Indonesia to rank fifth globally with a per capita income of USD 30,300.
Achieving this requires robust economic growth (Shari & Abubakar, 2.
, significantly influenced by the Labor Force Participation Rate (LFPR) (Solow, 1.
Despite improvements.
Indonesia's LFPR shows significant gender disparities, with female participation lagging behind due to socio-economic changes (Schaner & Das, 2.
, family welfare levels (LA ODE, 2.
, government policies (Akmal & Zulkifli, 2.
, and education level (Harijadi, 2.
Furthermore, despite periodic increases, the remuneration of women remains considerably inferior to that of men in Indonesia.
This underscores a persistent gender inequality that hinders economic growth.
Significant barriers faced by women compared to men in participating in economic development highlight a pronounced gender disparity in Indonesia.
As defined by Susanto .
, gender 681 | Ilomata International Journal of Tax & Accounting https://w.
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The United States, and Nepal Naury and Haptari inequality encompasses a range of disparities between genders, including economic marginalisation, the subordination of rights, stereotyping, exposure to violence and the fulfilment of multiple roles.
This inequality, driven by fundamental attitudes, results in persistent genderunequal outcomes (Astudillo et al.
, 2.
As observed by Ferrant & Kolev .
, gender inequality, as reflected in the Gender Inequality Index (GII), on a certain level can have a detrimental impact on global GDP.
In particular, gender inequality significantly impacts per capita income in Indonesia (Sari, 2.
Conversely, improving gender equality boosts economic growth (OECD, 2.
Enhancing gender equality involves developing human resources, market competitiveness, and productivity (OECD, 2.
From 2018 to 2022.
Indonesia's GII decreased 459, while the Gender Development Index (GDI) improved, thanks to efforts like the Gender Mainstreaming Strategy (PUG).
However, uneven gender development persists.
Globally, the Gender Gap in 2023, closed at 68.
4%, indicating it could take 131 years to achieve parity (Zahidi.
While a commitment to gender equality is an important step towards creating a more just and equitable society, it is not sufficient in itself to guarantee equal opportunities for men and women (Ajizah & Khomisah, 2.
Furthermore, it is crucial to acknowledge the role that equality plays in Indonesia's broader development process (Wibowo, 2.
It is at this point that the potential for taxation to play a role becomes apparent.
As stated by Stotsky .
that taxation is fundamentally gender-neutral, yet the tax system undeniably harbors gender explicit and/or explicit biases.
Approximately 51.
2% of OECD member countries consider gender a primary focus in tax policy-making (OECD, 2.
This is reflected in the implementation of tax reforms aimed at enhancing gender equality.
Gender-based taxation (GBT) represents a further development of the gender-responsive budgeting (GRB) movement, which concerns itself with the allocation of resources using a gender-responsive perspective.
While there is no universally accepted definition of GBT, it can be understood as a more gender-equal approach to taxation and budgeting.
Moreover.
Alesina et al.
Aos GBT advocation correlate GBT and Ramsey .
theory, which proposes that the tax system should be structured in a manner that imposes reduced taxes on groups with a higher elasticity of labor supply.
Moreover, the significance of Pigou's role in the combination of Pigou and Ramsey types into GBT considerations was highlighted in Moreover, the significance of Pigou's role in the combination of Pigou and Ramsey types into GBT considerations was highlighted in Meier & Rainer .
An example of GBT is Sri Lanka's policy, which allows companies to deduct an additional 50% of the salary costs for women on maternity leave from their taxable income.
In contrast.
Indonesia appears to have yet to implement the substantial incentives or relaxations offered by the government specifically to women, particularly those in the working class.
This highlights the necessity for a more genderequal tax policy (Widodo et al.
, 2.
In light of the foregoing information, we chose to undertake a comparative analysis of the implementation of GBT-in-line-policy in Singapore, the United States, and Nepal.
This analysis will examine the application of GBT in these countries and identify potential avenues for its application in Indonesia, with a particular focus on strategies for enhancing HDI and economic This research differs from previous studies in two key respects.
Firstly, it considers a different set of countries.
Secondly, it offers recommendations for the Indonesian government 682 | Ilomata International Journal of Tax & Accounting https://w.
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php/ijtc Gender-Based Taxation: Comparative Lesson for Indonesia from Singapore.
The United States, and Nepal Naury and Haptari based on a comparative analysis of the implementation of GBT in Singapore, the United States, and Nepal.
METHOD
The data collection method used in this research is a qualitative method in the form of a literature The literature study was carried out through secondary data analysis with a descriptivequalitative approach.
We chose literature study because this method was adequate in terms of providing the data needed to compile this research, in addition due to limited access to obtain primary data in the form of interviews with policy makers related to this research topic.
Secondary data used in the literature study are regulations, previous research data which includes research that has been studied extensively and that has not been studied extensively, survey results obtained from the Indonesian Central Bureau of Statistics (BPS) and World Bank, also relevant documents, all of which were published between 2014 and 2024 to maintain the relevance of research results.
The interpretation developed by the author on secondary data uses supporting theories put forward by experts on related topics and comparisons on each policy focus between Indonesia and comparison countries.
We developed some interpretation comparation the policy gender based taxed based on some From several references in analyzing the comparison, we summarize and divide into 3 .
core areas, namely gender background, gender-based taxes and the economic environment associated with gender issues as shown in the following table:
Area Gender background:
References that show explanations related to gender such as:
A gender inequality simultaneously has a significant effect on per capita income.
Gender inequality variables that have a partial effect include wages for women workers, women's labor force participation, and gender development A the problems and characteristics gender issues, gender References .
Ajizah.
, & Khomisah.
Babbar.
Martin.
Ruiz.
Parray.
, &
Sommer.
Ferrant.
, & Kolev.
Harijadi.
LA ODE.
Schaner.
, & Das.
Setyonaluri.
Nasution.
Ayunisa.
Kharistiyanti.
, & Sulistya.
Smith.
Kruse.
Weir.
, & Goldblum.
Susanto.
Tambunan.
Tuwu.
Wibowo.
Zahidi.
Zhu.
, & Kuriyama.
683 | Ilomata International Journal of Tax & Accounting https://w.
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The United States, and Nepal Naury and Haptari A highlighting gender specific constraints faced by female entrepreneurs in developing their businesses and participating in exports Gender Base Taxes:
A society resolves its distributional concerns efficiently with genderspecific lump sum transfers.
GBT with higher marginal tax rates on .
ingle and marrie.
men is optimal A tax systems and tax reforms on households depending on their composition and across the income The note also provides policy recommendations and good practices that will add to the regionAos efforts to strengthen fiscal policy taking a gender perspective into account.
A propose an alternative approach that starts with a clear focus on the policy goal of gender equality, from the perspective of a broader feminist fiscal policy agenda.
A the optimal structure of differential taxation by gender is partly determined by a Ramsey-type inverse elasticity rule and partly by a Pigouvian tax element.
A key aspects of fiscal policies and legislation that affect .
Alesina.
Ichino.
, & Karabarbounis.
Astudillo.
Cibils.
Pessino.
, &
Rossignolo.
Grown.
, & Mascagni.
Meier.
, & Rainer.
Niesten.
OECD.
OECD.
Ramsey.
Stotsky.
Widodo.
Priadana.
Ardana.
, & Fabillah.
684 | Ilomata International Journal of Tax & Accounting https://w.
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The United States, and Nepal Naury and Haptari gender equality by comprehensive baseline of reliable legal and tax The economic environment associated with gender issues:
References that show explanations related to Economic and gender area such as :
A economic growth, government spending, index of human development, the participation of female labor force A gender inequality, as reflected in the Gender Inequality Index (GII), on a certain level can have a detrimental impact on global GDP A the women who work and have income play significant role to support the family finance, to meet the needs of household life such as: as the complementary of the husband and family for daily shopping for schoolAos fee and childrenAos expenses.
and for other important needs such as when it comes to crises, severe illness, and other family problems.
Akmal.
, & Zulkifli.
Folbre.
Kotler.
, & Keller.
Rakhmawati.
, & Rani.
Sari.
Shari.
, & Abubakar.
Solow.
685 | Ilomata International Journal of Tax & Accounting https://w.
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The United States, and Nepal Naury and Haptari RESULT AND DISCUSSION Domestic Work Support Gender Inequality in Indonesia gives form to a stereotype that associates women with their obligations to domestic roles, using the term "dapur, sumur, kasur" or kitchen, well, and bed (Tuwu.
This negative connotation limits the capabilities of women in line with the results of Setyonaluri et al.
research indicates that over 90% of women between the ages of 18 and 40 are primarily responsible for domestic work, which is not formally remunerated.
Further, the majority of employed women subsequently opted to resign, attributing their decision primarily to domestic responsibilities (Setyonaluri et al.
, 2.
The absence of sufficient domestic service provision by the government can act as a deterrent for women in labor force by giving them longer working hours and bigger workloads (Folbre, 2.
Furthermore, it results in a reduction in the proportion of women participating in the labor market (Schaner & Das, 2.
Policy initiatives have been implemented in Singapore and the United States to provide support for women in the workforce.
In Singapore, married women are entitled to a reduction in taxable income equivalent to twice the foreign worker levy, which provides financial relief for those who employ domestic workers.
The United States (U.
) offers a tax credit, known as the Child and Dependent Care Credit, which allows parents to claim a maximum of 35% of qualifying care expenses, thereby reducing the amount of tax owed.
These measures provide flexibility and peace of mind for working mothers.
Indonesia on the other hand does not explicitly provide specific said tax regulations, it does facilitate the deduction of expenses for childcare facilities as income deductions for companies, on the condition that the facilities in question fulfill the benefit in kind However.
Indonesia could further ease the domestic work burden by adopting specific regulations similar to those in Singapore and U.
, as an illustration, the Indonesian government could implement an income deduction on individual income tax specifically for daycare and/or child caregiver expenses, potentially modeled on the zakat as an income deduction scheme.
Working Women In Nepal, women who are solely reliant on one source of income from employment .
emuneration onl.
are eligible for a 10 percent tax deduction.
This deduction does not apply to women who have opted to combine their income with their husband for tax purposes.
This policy was enacted as part of Nepal's efforts to encourage women to participate in the labor force by providing a substantial tax rebate with no nominal limit.
Thus far.
Indonesia has yet to implement a policy that is explicitly tailored to the unique challenges and opportunities faced by women being in the Indonesia could adopt a policy modeled by Nepal, which provides reward for women's participation in the labor force.
Singapore offers a total of 16 weeks of paid maternity and paternity leave, with the first eight weeks of salary paid by the employer and the remaining weeks funded by the government.
, while women who are engaged in business or freelance who do not have the security of an employer are given a cash incentive of 56 days of total earnings.
While the application of similar policies in Indonesia is still limited to the imposition of maternity leave as a deduction from an employer's income.
Indonesia may follow Singapore's example by re-examining the duration of paid maternity leave and designing tax policies that are inclusive of those who are not covered by formal employment.
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The United States, and Nepal Naury and Haptari Tax Incentives for Caregiver Singapore provides an extra $3000 taxable income deduction for women who are married, divorced or widowed and are caring for their parents, in-laws, ex-in-laws, someone 12 years older or unmarried disabled people.
This policy only applies to one woman per family.
additional tax deductions from the share of expenses for taking care of dependents left behind to work but not specific to women.
In Indonesia, the benefits available to caregivers are confined to income deductions for dependents and are not gender-specific.
This reflects a tax implicit gender bias whereas tax benefits structure does not account for unpaid caregiving work, which is predominantly performed by women.
Consequently, women are unable to benefit from the same tax advantages as men, who may be able to claim reimbursement for childcare costs from their employers (Grown & Mascagni, 2.
Indonesia has the option of adopting the personal income tax benefits approach, as exemplified by Singapore and the United States.
This would entail providing benefits to the rightful owner, accompanied by supporting documentation attesting the coverage of dependents.
Widows Singapore exempts taxes for alimony, whereas the United States provides an additional income deduction of $25,900 per tax year for a period of two years following the death of a spouse.
Nepal, a 35% tax deduction is available on the registration of land ownership in the name of a woman whose spouse has died.
Furthermore, tax is exempted on government allowances received by women with a deceased spouse.
In contrast.
Indonesia continues to categorize alimony as taxable income and does not have any explicit regulations providing tax facilities for widows.
would be beneficial for Indonesia to consider implementing temporary income deductions upon the death of a spouse, as well as tax exemptions on alimony and other nominal support provided to widows, in line with the examples set by the three previously mentioned comparator countries.
These tax incentives represent a form of state intervention aimed at providing assistance to an individual who is experiencing difficulties in managing their financial situation as they adjust to a new reality in their life, as Niesten .
addressed the absence of tax policies in Asia and the Pacific that recognize widows as a vulnerable demographic.
Woman-Owned Businesses and CorporationAos Participation In supporting women's entrepreneurship and promoting economic independence among women.
Nepal's policy of offering a 10-year tax exemption for women-owned businesses could be adapted to provide greater support and encourage more women to initiate a culture of entrepreneurship and sustain businesses in Indonesia, in accordance with data provided by the World Bank, in 2015, 1% of businesses in Indonesia had the participation of women in ownership and to address the primary obstacle preventing women from establishing business enterprises is the difficulty they experience in accessing financial credit (Tambunan, 2017.
Zhu & Kuriyama, 2.
A tax credit is available in the United States for companies which hires specific person that falls on certain group that implicitly favors women.
The credit is up to $2,400 for each newly hire.
an effort to promote gender equality in the workplace.
Nepal has implemented a 10% tax reduction for companies with a minimum of one-third female employees.
Despite the lack of an explicit instrument to encourage companies to recruit women and facilitate women's workforce participation.
Indonesia permits companies to expense Corporate Social Responsibility (CSR) 687 | Ilomata International Journal of Tax & Accounting https://w.
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The United States, and Nepal Naury and Haptari activities as an income deduction, thereby enabling them to contribute to gender equality and women's empowerment through various program initiatives.
Indonesia has the potential to emulate Nepal's approach by implementing targeted policies that encourage the involvement of private enterprises in addressing the constant imbalance in the representation of women in the labor force.
Pink Tax In addition to income tax, women are confronted with gender-based disparities in consumption These costs are often higher for women than for men, a phenomenon observed in nearly all countries, including Indonesia (Rakhmawati & Rani, 2.
In the United States, this phenomenon is referred to as the "pink tax".
The United States Government Accountability Office .
asserts that there is no additional cost to companies for producing goods labeled pink, a finding that aligns with the conclusions of Rakhmawati & Rani .
These researchers argue that the pink tax phenomenon is merely a means for companies to boost their profits.
The price differentiation strategy aligns with the first stage of the price discrimination theory, wherein providers establish distinct pricing for the same product to distinct market segments (Kotler & Keller, 2.
In order to eliminate the phenomenon of the "pink tax," the United States government has drafted bills at the state and federal levels that address price disparities and tax exemptions on products designed for women's health and other consumer goods.
In example.
The Gender Tax Repeal Act of 1995 and the Improving Diaper Affordability Act of 2023 bill.
The Indonesian government has yet to address the potential impact of the so-called "pink tax" on consumption patterns and the implicit gender bias inherent in this phenomenon.
Indonesia may wish to consider adopting a similar approach to that taken by the United States with regard to the exemption of certain items from value-added tax (VAT).
This could potentially include items such as diapers and sanitary napkins, which are regarded as being among the essentials of daily living and human rights (Babbar et al.
, 2022.
Smith et al.
, 2.
Taxation for Families In the context of a number of women performing multiple roles in supporting the economic activities of their households, the majority of women face the challenge of a higher marginal tax rate as a second-earner in a joint-taxation scheme, as OECD .
states that 75% of secondearners in Organization for Economic Co-operation and Development (OECD) member countries are women.
The majority of countries, including Indonesia, have an opt-out joint taxation scheme that categorizes married women as a single entity with their husbands by default.
In contrast.
Nepal employs an opt-in joint taxation scheme, affording women greater autonomy in financial decisionmaking and the ability to navigate the higher marginal tax rate associated with the progressive tax Indonesia may benefit from adopting an opt-in joint taxation system, as exemplified by the approach taken in Nepal.
Further research is required on Indonesia's second-earner tax wedge in the context of the latest regulatory developments.
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The United States, and Nepal Naury and Haptari CONCLUSION The gender gap that occurs in social life, especially for women, is a real problem that requires the presence of the state to mediate.
Price disparities, stereotypes, domestic job responsibilities, sexual and domestic violence, wage gaps, the choice between working or being a housewife are all things that hinder and hinder a woman that can be minimized through taxation and budgeting policies that use a gender perspective.
Governments can help optimize gender equality through the use of tax and budgeting functions that take into account the explicit and implicit impact of taxation on gender.
This is called Gender Based Taxation.
Singapore.
Nepal, and the United States have implemented a series of policies that create a more welcoming ecosystem for women to participate in economic activities, which Indonesia can use as an example in designing Gender Based Taxation in the future.
Nevertheless, further research is required to assess the feasibility of implementing said policies in the context of Indonesia's socio-economic conditions.
REFERENCE