Taxation and the redistribution of power

This is part of a series: "Tax Justice Through a Feminist Lens". The series builds on my previous article, "Do You Pay Your Taxes?" The voices in that article asked honest questions. Where does our money go? Why does the system feel rigged? Why do women bear the heaviest burden? This series provides the answers, one layer at a time. Each piece examines a different dimension of tax justice through a feminist political economy lens. Together, they reveal the architecture of a system designed by the powerful, for the powerful. And they show what it takes to change it.

Who decides what you pay?

Who decides what you pay? Who decides where it goes? These are political questions, not technical ones.

Tax justice, from a feminist political economy lens, exposes how power operates through fiscal systems. It demands to know who is required to contribute, who benefits from public resources, and who remains invisible in economic design. These questions shape whether a mother can feed her children, whether a girl stays in school, whether a woman with a small business can sleep without fear of a tax official at her door.

Taxation is about redistribution, accountability, and transforming structural inequality. It forces us to examine whether systems are progressive or regressive. Whether multinational corporations and wealthy elites pay their fair share. Whether governments use revenue to fulfil social and economic rights or to line the pockets of the connected.

What does progressive taxation look like?

Progressive taxation means those with more ability to pay contribute a larger share. Income taxes that rise with earnings. Wealth taxes on large fortunes. Corporate taxes that cannot be avoided through loopholes. This is investment in the society that made success possible. No one builds a business without roads for their goods, workers shaped by public education, security that protects their premises. These are public goods funded by taxes. When the wealthy avoid paying, they free-ride on everyone else's contribution.

Who really bears the burden?

Regressive taxation takes a larger share from those with less. Many taxes operate this way. Two mechanisms in particular expose how regressive systems work: trading licences and presumptive income tax.

Consider the trading licence. Technically, it is a regulatory fee, not a tax. But its effect is the same: money leaves your pocket and goes to the state. The amount you pay is based on where your business is located and what you sell. It takes no account of your stock, your capital, your volume of trade, or whether you make a profit. Location determines liability. Nothing else matters.

Two businesses on the same street in Kampala pay the same trading licence. One repairs phones with a capital investment of under ten thousand dollars. The other sells electronics worth hundreds of thousands. They pay the same amount. The licence cannot tell the difference between survival and surplus. It treats both as identical economic units. This is not a tax on income. It is a tax on existence.

Now consider presumptive income tax. On the surface, it appears fair. Businesses with the same annual turnover pay the same amount. If two businesses each have gross turnover of USD 10,000 and both pay USD 1,000 in income tax, that seems reasonable. Equal turnover, equal tax.

But turnover is not profit. The costs of doing business vary dramatically by sector.

Imagine two businesses with identical annual turnover of USD 50,000.

One sells high-value electronics. The products arrive in boxes, sit on shelves, and sell over months or years. Storage costs are minimal. No staff are needed beyond the owner. No goods spoil. No heavy lifting. No assistants. The business could even operate online. Annual costs: USD 20,000. Profit: USD 30,000. Tax paid: USD 3,000. Effective tax rate on profit: 10 percent.

The other sells fresh produce in an upscale residential neighbourhood. Pineapples, watermelons, mangoes, tangerines. The residents can afford the extra charge for convenience. She buys at USD 1 per kilogram and sells at USD 2. With steady demand, annual turnover reaches USD 50,000.

The trader rises before dawn to travel on poor roads to the wholesale market. She buys stock, loads it onto transport, and brings it back to her kiosk. She pays for transport, for storage, for informal levies, for handling, for assistants to help lift heavy sacks. Pineapples and mangoes have limited shelf life. On day one, a mango sells at full price. Day two, it must be discounted. Day three, it may be lost. Spoilage is constant. Some days she sells at a loss just to clear stock before it rots. Annual costs: USD 40,000. Profit: USD 10,000. Tax paid: USD 3,000. Effective tax rate on profit: 30 percent.

Same turnover. Same tax. Vastly different outcomes. The produce trader pays three times more of her actual income in tax than the electronics seller. The system treats them equally. The result is profoundly unequal.

This is the distortion of turnover-based taxation. It taxes revenue without regard to what it costs to generate that revenue. It penalises the sectors where women are concentrated: fresh produce, prepared food, market retail. These are high-volume, low-margin, labour-intensive businesses that survive on thin margins and constant effort.

When tax becomes a tax on being female

Value-added tax (VAT) compounds this injustice. VAT applies to most goods and services. Rich and poor pay the same rate. But the poor spend a larger share of their income on consumption. Every dollar they earn is spent on something, and every dollar spent carries VAT. The wealthy can save and invest, avoiding consumption taxes on the portion of income they do not spend.

When VAT applies to sanitary pads, it becomes a reproductive tax. It taxes women for a biological function they did not choose. When VAT applies to cooking fuel, it taxes women for their socially ascribed role as carers who prepare meals. When VAT applies to food, it taxes the person who feeds the family.

Women manage household consumption. Women do the cooking. Women menstruate. A tax on cooking fuel lands on the woman who tends the stove. A tax on sanitary pads lands on the woman who has no choice. A tax on food lands on the woman who must stretch every shilling to feed her children.

Research from across Africa shows that women-headed households spend a larger share of their income on VAT than men-headed households. The tax system takes more from those who have less to give.

Why this is a feminist issue

A feminist political economy approach demands we look beyond formal neutrality. It requires examining sectoral distribution, gendered patterns of enterprise, and the structural constraints women face.

Women are concentrated in low-margin, high-volume sectors. Food vending, small-scale agriculture, market retail, care-linked microenterprises. These sectors are labour-intensive, vulnerable to price volatility, and dependent on unpaid family labour. When tax systems levy fixed amounts based on location or turnover, they burden women disproportionately.

Many low-margin businesses survive because women absorb shocks through unpaid care work. A bad week in the market means less food on the family table. A tax bill on a loss-making month means borrowing from neighbours or sending children to bed hungry. The business and the household are not separate. They are the same survival unit.

Tax systems typically evaluate equity, efficiency, and administrative simplicity. Presumptive tax prioritises simplicity over equity. The phone repairer and the electronics seller face identical tax liability. One generates survival income. The other generates surplus. The system cannot tell the difference.

When states rely heavily on simplified taxation of small traders while corporate tax avoidance persists, while high-net-worth wealth remains lightly taxed, while extractive sectors receive incentives, the fiscal burden shifts downward. Women in precarious, low-margin sectors absorb a disproportionate share.

Who holds the power to design tax systems?

This is the question that underlies all others. Who holds the power to design tax systems? Who benefits from the current design? Who fights to change it?

When citizens in Kampala say, "I pay for everything myself and still they ask for more," they describe the outcome of these power struggles. They name a system designed to extract from them while protecting those with wealth and connection.

Tax justice demands we shift that power. Design systems where contribution reflects actual ability to pay. Where trading licences consider economic reality, not just location. Where presumptive tax accounts for sectoral differences and genuine costs of doing business. Where VAT exemptions protect necessities rather than taxing survival. Where transparency is non-negotiable and public resources serve the public good.

This is political work. It always has been.

In the next piece, we examine how tax systems are built on assumptions about gender—what those assumptions cost women, and why neutrality is a fiction.