I would have a hard time countenancing an argument that The Handmaids Tale (and by extension, The Testaments) is not sci-fi, in a world where Heinlein's "If This Goes On—" is widely regarded to be sci-fi.
On the other hand, if Atwood doesn't wish to be regarded as a sci-fi author, so be it
She's repeatedly said she doesn't. Indeed her dismissive remark that "SF is that 'squids in space' stuff, isn't it?" is what inspired the great Ken Macleod to write his "Engines of Light" trilogy which starts with Cosmonaut Keep.
Due to her attitude I've never even tried to read any fiction of hers. Macleod is a genius nearly on a level with his close friend Iain Banks.
I am with the other commenter in this thread: I've read quite a few (usually very highly-regarded) alleged SF novels by literary authors who say they don't write SF. I have hated pretty much every such book.
In fact I don't think "The Handmaid's Tale" really makes sense without the context of the AP feminists. Gilead comes about, as I understand it, because the AP feminists think they can use the Religious Right to achieve their goals and unsurprisingly that goes badly for them. AP feminism doesn't even exist when "Left Hand" was published.
But maybe that’s just post-hoc rationalization for a reactionary stance, idk.
Needless to say, I will also never read any of her work.
[1] https://globalnews.ca/news/3707723/margaret-atwood-condo-con...
But the difference is that Atwood was, when she wrote "The Handmaids Tale" an author but not a Sci-Fi author. Whereas Butler and Miller were Sci-Fi authors.
And yes, "is this book sci-fi?" is a fuzzy category, and of no great importance.
I respect Margaret Atwood's opinion here but I don't quite hold it myself. More so about Oryx and Crake and sequels.
By "IDK if "The Testaments" qualifies though" I mean that I have not read it, just "The Handmaids Tale" so I'm not going to opine on something that I don't know about.