the China It will impose a tax on added value (Value added tax) in medicines and contraceptive devices – incl Condom – For the first time in three decades, in the latest attempt to reverse the sharp decline in oil prices Birth rates Which threatens to slow down further economy.
Under the new VAT law, consumers will pay a 13% tax on goods that have been exempt from VAT since 1993, when China implemented a strict one-child policy and actively encouraged birth control.
At the same time, the revision also creates new incentives for prospective parents by excluding childcare services – from daycare centers to kindergartens – as well as aged care facilities, providers of services for people with disabilities, and marriage-related services. The changes take effect in January.
They reflect a broader political shift as China’s rapidly aging population moves from limiting births to encouraging people to have more children. The population has declined for three straight years, with just 9.54 million births in 2024 – just over half the 18.8 million recorded nearly a decade ago, when the one-child policy was lifted.
In response, Beijing has implemented a series of pro-birth policies, from providing financial aid to improving childcare services and extending parental leave. The country also announced guidelines to limit the number of abortions not considered “medically necessary” — in sharp contrast to the coercive reproductive controls of the one-child era, when abortions and sterilizations were routinely imposed.
China’s attempts to change the birth rate have faced a fundamental hurdle: China is one of the most expensive countries to raise children, according to a 2024 report from the Yuewa Population Research Institute in Beijing.
Raising a child until the age of 18 costs more than 538,000 yuan ($76,000), a price that many young people consider unaffordable amid the slowdown in the economy and the unstable labor market. As social values change, others choose to invest in their stability and career at the expense of family life.
However, authorities are increasingly focusing on measures designed to change social attitudes towards childbirth – even when direct effects are limited.
“Repealing the VAT exemption is largely symbolic and is unlikely to have a significant impact on the bigger picture,” said He Yafu, a demographer at Yua University. Instead, it “reflects an effort to shape a social environment that encourages childbirth and reduces the incidence of abortion.”
“We can’t stand this”
The VAT also comes at a time when HIV – which has been on the decline worldwide – is rising sharply in China, with stigma and limited sex education continuing to hamper public understanding. Most new cases of the disease are associated with unprotected sex.
Between 2002 and 2021, the rate of reported HIV and AIDS cases rose from 0.37 per 100,000 people to 8.41, according to the country’s Centers for Disease Control and Prevention.
The price increase quickly sparked controversy on Weibo, the Chinese microblogging site, with some users expressing concern not only about the potential for unwanted pregnancy, but also the possibility of sexually transmitted diseases spreading more quickly if people used fewer condoms.
“Given the high rates of HIV infection among young people, raising prices in this way may not be a good idea,” one user wrote. “It’s a poorly thought out approach.”
Others criticized the tax as ineffective and argued that higher prices would do little to change attitudes toward motherhood and fatherhood. “If someone can’t afford condoms, how can they raise a child?” one person asked.