Should taller people pay a higher tax?

A cafe in Melbourne charges men an 18% higher rate than women, for the same food. The goal of this is to raise awareness about the gender earnings gap. The proceeds from the premiums are donated to various charities supporting women's causes. Higher prices for men can be seen as a "Man Tax".



Studies find that a gender earnings gap does exist. But there are several other gaps. Attractive people earn a higher income. This is often referred to as "The Beauty Premium." Taller people are found to earn a higher income than shorter people. One study proposes to include a height tax. Based on a data analysis of the existing height earnings gap, they propose that a tall person earning $50,000 should pay $4,500 more in tax than a short person. Although not every tall person earns more than every short person, on average tall people earn more than short people. A height tax would essentially offset the earnings gap.

We could build a more complicated tax system that accounts for various other exogenous factors that correlate with income. The tax a person pays could also possibly account for his/her income, gender, race, age, height, attractiveness, IQ, health disorders, and maybe even his/her propensity to underreport his income. If these exogenous factors that are beyond the control of a person affect his income, then it seems fair to compensate him accordingly.

A personalized tax system would only be necessary if there are arbitrary gaps in income. The increasing reliance on algorithms might help to reduce a bias in recruitment and subsequently an earnings gap.

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Comments

  1. Laura R10 January 2018 at 04:05

    Hi Krishna!! I think that the wage gap for height, attractiveness are correlated with their economic and social background. However, women get payed less regardless of their education and their background.

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    Replies
    1. krishna srinivasan12 January 2018 at 04:56

      Hi Laura. My argument rests on the assumption that height and attractiveness are not correlated with economic and social background. The paper I cite refers to height as an exogenous variable. I understand that this assumption may be hard to prove in practice. But I understand your argument.

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