China has introduced a 13 percent value-added tax (VAT) on contraceptives, including condoms and birth control pills, as part of a wider tax reform, even as the country struggles with a declining population.
At the same time, the government has kept VAT exemptions for childcare, elder care and disability services, signalling a shift in priorities as China moves away from policies rooted in the one-child era of the 1990s.
The decision comes amid worrying demographic trends. Official data shows China’s population has declined for several consecutive years, with the 2024 birth rate now about half of what it was ten years ago. Authorities have been urging young people to marry earlier and have children to counter an ageing population and a shrinking workforce.
However, the new tax on contraceptives has triggered criticism from health experts and social commentators. They argue that making condoms and birth control pills more expensive is unlikely to encourage childbirth, and instead risks limiting access to safe contraception, particularly for low-income groups.
Some health advocates warn the policy could lead to more unintended pregnancies and a higher risk of sexually transmitted infections, especially among young people and vulnerable communities.
Economic realities remain a major barrier to higher birth rates. High housing costs, expensive education, rising childcare fees and demanding work cultures—particularly for women—continue to discourage many couples from starting families. A Beijing-based research institute recently ranked China among the most expensive countries in the world to raise a child.
Economists say the tax reform may also be driven by the need to boost government revenue as China grapples with slower economic growth and ongoing challenges in the real estate sector.
Social analysts note that beyond finances, young Chinese adults face intense social and psychological pressure, contributing to delayed marriages and fewer children. Despite rising living standards, many report feeling overburdened by expectations.
Experts caution that tax changes alone are unlikely to reverse China’s demographic decline unless deeper economic and social concerns—such as job security, housing affordability and work-life balance—are addressed.
