China has introduced a 13 per cent sales tax on contraceptives while exempting childcare services from taxation, as part of a broader policy shift aimed at reversing the country’s declining birth rates and ageing population.
The measures, which took effect on January 1, form part of a wider tax overhaul that removes long-standing exemptions dating back to the one-child policy era. In addition to childcare, the reforms also provide tax relief for marriage-related services and elderly care.
Authorities say the changes reflect growing urgency in Beijing to encourage young people to marry and have children, amid sustained demographic decline. Official figures show that China recorded only 9.54 million births in 2024, marking the third consecutive year of falling birth numbers.
However, experts have expressed scepticism over the likely impact of taxing contraceptives on fertility trends. Yi Fuxian, a demographer at the University of Wisconsin–Madison, argued that the policy may be misplaced.
“The idea that a tax hike on condoms will impact birth rates is overthinking it,” he said, suggesting the move may also be influenced by revenue considerations, given that value-added tax generated nearly $1 trillion last year.
Some analysts and members of the public have warned of unintended consequences.
Rosy Zhao, a resident of Xi’an, cautioned that making contraception more expensive could disproportionately affect students and low-income earners, potentially encouraging risky behaviour. On social media, several citizens responded with ridicule and concern, noting that high childcare and living costs remain the primary obstacles to starting families.
Economists also point to deeper structural challenges facing young Chinese adults, including demanding work cultures, stagnant wages and pressures linked to the property market.
“Young people today deal with far more stress than previous generations. Many are simply exhausted,” said Daniel Luo, a resident of Henan province.
China’s strategy mirrors efforts in other ageing societies such as Japan and South Korea, where generous incentives have so far failed to reverse declining birth rates. Analysts caution that symbolic measures, including taxing contraceptives, are unlikely to produce meaningful results unless accompanied by sustained investment in affordable childcare, improved work-life balance and broader social reforms.
