China to impose higher tax on condoms to fight dwindling birth rates

International

CHINA is reshaping parts of its tax system in a renewed bid to lift falling birth rates, introducing a new levy on contraceptives while scrapping taxes on childcare and other family-related services.

The changes take effect on Jan. 1 and come as the country grapples with an ageing population and slowing economic growth, a report by BBC said.

Under the overhaul, contraceptives such as condoms, birth control pills and devices will now be subject to a 13% value-added tax, ending exemptions that have existed since 1994, when China was still enforcing its one-child policy. At the same time, childcare services, marriage-related services and elderly care will be exempt from VAT.

The measures are part of a broader package aimed at encouraging marriage and childbearing, which also includes longer parental leave and cash incentives.

Official data show China’s population has declined for three consecutive years, with just 9.54 million babies born in 2024 — roughly half the number recorded a decade earlier.

The decision to tax contraceptives has sparked debate and ridicule online, with critics questioning whether higher prices for condoms could realistically persuade couples to have children.

Social media users joked about stockpiling supplies, while others pointed out that the cost of contraception pales in comparison to the expense of raising a child.

China remains one of the costliest countries in which to raise children, according to population researchers, citing high education expenses, intense academic competition and the challenges women face balancing careers and parenting.

These pressures have been compounded by an economic slowdown and a prolonged property crisis that has dented household confidence.

Some parents dismissed the price increase as negligible.

A father from Henan province said a modest rise in condom prices would not affect family planning decisions, describing it as an inconvenience rather than a deterrent.

Others, however, warned that making contraception more expensive could push students or low-income individuals toward risky choices.

Demographers are divided over Beijing’s true motives. Some argue the move is largely symbolic and unlikely to influence fertility rates, while others see it as part of a broader effort to shore up government revenues amid mounting fiscal strain.

Value-added tax already accounts for a significant share of China’s total tax intake.

Analysts also caution that implementation may fall unevenly on debt-laden local governments, potentially limiting the impact of subsidies and services.

There are concerns, too, that heavy-handed state involvement in personal decisions — such as reports of officials tracking women’s reproductive plans — could backfire and deepen public resistance.(Xienderlyn Trinidad, USJ-R Comm Intern)