Pink Tax law takes hold in New York: Gender-based pricing on select services, goods will be illegal

The ‘pink tax’ which was included as part of the 2021 budget earlier this year goes into effect across New York State this week.

The new reforms prevent businesses from charging difference prices for “substantially similar” consumer goods or services that are marketed to different genders.

In April the Governor signed the FY 2021 New York State Budget which included the Governor’s proposal to ban the “Pink Tax.” The new measure requires certain service providers to provide price lists for standard services upon request and notifies them that gender-based price discrimination is prohibited under State law. Businesses that violate the law will be subject to civil penalties.

“New York is leading the nation in advancing women’s rights and this milestone marks the latest step in New York’s journey to break down barriers and put women on an equal playing field,” Governor Cuomo said. “By abolishing the pink tax, women and girls will no longer be subject to harmful and unfair price discrimination and any businesses who fail to put an end to this despicable practice will be held accountable.”

“Women and girls continue to face inequalities in many aspects of their daily lives, and it is unacceptable that they have to pay more than men for similar goods and services,” said Lieutenant Governor Kathy Hochul. “Eliminating the pink tax helps put an end to gender-based pricing, ensure financial success and break down barriers for women. We do not tolerate discriminatory actions in our state, and we will continue to fight to eliminate the gender wage gap and achieve full equality and justice for all New Yorkers.”

“The Pink Tax was gender-based discrimination, plain and simple,” Melissa DeRosa, Secretary to the Governor and Chair of the New York State Council on Women and Girls, said. “In New York, women have been forced to accept the unjust reality of a higher price tag for identical goods marketed to men. It was unacceptable and starting today women and girls across this state can be confident that it won’t happen again. New York has made tremendous progress in advancing gender equity through Governor Cuomo’s Women’s Agenda and abolishing the pink tax is a critical next step.”

Secretary of State Rossana Rosado said, “For far too long, women have paid more for services and products that were substantially the same as the male marketed version. I applaud Governor Cuomo for his leadership in ending this widely accepted, everyday injustice that women of all ages have suffered in the marketplace. This landmark law points to a new and fair era for women in the marketplace.”

Since the early 1990s, numerous studies have demonstrated the stark disparities in the cost of substantially similar goods and services based on whether they were marketed for men or women. Across the board, the studies found that women paid more for the female version of the same product offered to men. The economic impact on women to pay more for the same product has a greater overall reach than those immediate purchases. Starting today, September 30, 2020, the gross compound effect of the gender-based price disparities comes to an end in New York State.

The new law mandates that any individual or entity, including retailers, suppliers, manufacturers or distributors, are prohibited from charging a price for two “substantially similar” goods or services, if the goods or services are priced differently based on the gender for whom the goods or services are marketed.

“Substantially similar goods” is defined as two goods that exhibit little difference in the materials used in production, intended use, functional design and features, and brand. “Goods” include any consumer product used, bought, or rendered primarily for personal, family or household purposes. For example, the same children’s swimming pool product brand and dimensions offered in pink at $89.99 and blue at $69.99 would constitute a violation of law.

“Substantially similar services” is defined as two services that exhibit little difference in the amount of time delivering, difficulty, and cost in providing the service. “Services” include any consumer services used, bought or rendered primarily for personal, family or household purposes. For example, dry cleaning a woman’s suit jacket for $12 and a man’s suit jacket for $8, would constitute a violation of law.

The new law also seeks to empower consumers by giving them the right to receive, upon request, a written price list from any business that provides a service. The New York State Division of Consumer Protection encourages consumers to familiarize themselves of the new requirement and ask their service providers in advance for a price list.

Anyone selling products or providing services can avoid running afoul of the new law by ensuring that any price difference is based upon the following:

  • The amount of time it took to manufacture such goods or provide such services
  • The difficulty in manufacturing such goods or offering such services
  • The cost incurred in manufacturing such goods or offering such services
  • The labor used in manufacturing such goods or providing such services
  • The materials used in manufacturing such goods or providing such services
  • Any other gender-neutral reason for having increased the cost of such goods or services

Violations of the law are subject to the court ordered enjoinment of such sales, restitution to consumers, up to a $250 fine for the first violation, and up to $500 fine for any subsequent violations.

The New York State Division of Consumer Protection serves to educate, assist and empower New York State consumers. Starting September 30th, if you find a product or service offered for sale in New York State that does not comply with the new law, you may contact the Division of Consumer Protection at 800-697-1220 Monday to Friday, 8:30am to 4:30pm or file a complaint online at www.dos.ny.gov/consumerprotection. The Division can also be reached via Twitter at @NYSConsumer or Facebook atwww.facebook.com/nysconsumer.