Beijing: China has ended a tax exemption on contraceptive drugs and devices that had been in place for more than 30 years, marking a fresh attempt to address the country’s steadily declining birth rate.
From January 1, products such as condoms and contraceptive pills are subject to a 13 percent value-added tax, the standard rate applied to most consumer goods. The change comes as authorities grapple with deepening demographic pressures in the world’s second-largest economy.
China’s population declined for a third consecutive year in 2024, underscoring the scale of the challenge facing policymakers. Demographers have warned that the downward trend is likely to persist, driven by long-term structural factors and shifting social attitudes.
In parallel with the tax change, Beijing has rolled out a series of measures aimed at easing the financial burden on families. Last year, childcare subsidies were exempted from personal income tax, and a nationwide annual childcare allowance was introduced.
Educational institutions were also encouraged to promote what officials describe as love education, with a focus on presenting marriage, family life, and childbearing in a more positive light.
The issue was again highlighted last month when China’s top leadership reaffirmed its commitment to fostering supportive attitudes towards marriage and parenthood at the annual Central Economic Work Conference.
Birth rates in China have been falling for decades, a legacy of the one-child policy that was enforced from 1980 until 2015, combined with rapid urbanisation. More recently, high childcare and education costs, job insecurity, and a slowing economy have made many young people reluctant to marry or start families, adding urgency to Beijing’s efforts to reverse the trend.
