Fiscal policy is a critical tool toward enabling gender equality, as well as other forms of equity in society.1 It is where key decisions are taken about how much tax to raise (how big is the government), where that revenue comes from (which groups contribute, comparatively), and how the available budget is spent (competing spending priorities). Policies that enable equity, for example, include progressive taxation that closes opportunities for avoidance and evasion for higher-income earners and large firms, while protecting lower-income earners and small businesses.2 On the spending side, equitable policies include investment in care and allocations aimed to reduce gender gaps and encourage women’s labor force participation, which, over time, contribute to an expanded tax base and fiscal space. Fiscal policy—and the processes associated with it—is essential to gender equality because it alters what gets funded (expenditure priorities), how it’s funded (tax/transfer design and off-budget tools), and who can scrutinize it (accountability and transparency).
This article is part of the Brookings Center for Sustainable Development compendium “Innovations in public finance: A new fiscal paradigm for gender equality, climate adaptation, and care“.