China has imposed a value-added tax on condoms and contraceptive pills, ending a more than 30-year tax exemption as authorities intensify efforts to reverse the country’s declining birth rate.
Under the new policy, which took effect on January 1, condoms and contraceptive drugs are now subject to a 13 per cent value-added tax the standard rate applied to most consumer goods according to a Reuters report.
The move comes as Beijing grapples with a sustained population decline in the world’s second-largest economy.
Official data show that China’s population fell for a third consecutive year in 2024, deepening concerns among policymakers and demographers over long-term economic and labour force pressures.
In recent years, the Chinese government has rolled out a series of measures aimed at encouraging marriage and childbearing.
These include tax exemptions on childcare subsidies, the introduction of annual childcare support payments, and policies described by authorities as “fertility-friendly.”
Education institutions have also been urged to promote what officials term “love education,” encouraging positive attitudes toward marriage, family life and childbearing among young people.
At last month’s Central Economic Work Conference, China’s top leadership reaffirmed its commitment to fostering “positive marriage and childbearing attitudes” as part of broader efforts to stabilise the country’s birth rate.
China’s demographic challenges are widely linked to the long-term effects of the one-child policy enforced between 1980 and 2015, as well as rapid urbanisation, rising living costs and changing social norms.
High childcare and education expenses, job insecurity and a slowing economy have further discouraged many young people from starting families.
Authorities have not indicated whether additional fiscal or social incentives will follow as Beijing seeks to arrest the demographic decline.
