China Implements Condom Tax to Tackle Declining Birth Rates

Thu Jan 01 2026 06:07:48 GMT+0200 (Eastern European Standard Time)

In a controversial move, China introduces a 13% sales tax on contraceptives while hairing childcare services, aiming to reverse its falling birth rate amid economic challenges.

Starting January 1, a new 13% tax on contraceptives like condoms and birth control pills will be implemented in China, accompanied by the tax exemption for childcare services. Officials believe these moves will encourage higher birth rates as the country faces an aging population and a significant decline in births. While the government hopes this policy will reverse the trend, public reaction is mixed, with concerns about potential unwanted pregnancies and the broader socioeconomic implications of raising children in modern China.

Chinese people will pay a 13% sales tax on contraceptives from 1 January, while childcare services will be exempt, as the world's second-largest economy tries to boost birth rates.

An overhaul of the tax system announced late last year removes many exemptions that were in place since 1994, when China was still enforcing its decades-long one-child rule.

It also exempts marriage-related services and elderly care from value added tax (VAT) - part of a broader effort that includes extending parental leave and issuing cash handouts.

Faced with an ageing population and sluggish economy, Beijing has been trying hard to encourage more young Chinese people to marry, and couples to have children.

Official figures show that China's population has shrunk three years in a row, with just 9.54 million babies born in 2024. That is around half of the number of births recorded a decade ago, when China started to ease its rules on how many children people could have.

Still, the tax on contraceptives, including condoms, birth control pills and devices, has sparked concern about unwanted pregnancies and HIV rates, as well as ridicule. Some people point out that it would take a lot more than pricey condoms to persuade them to have children.

As one retailer urged shoppers to stock up ahead of the price hike, a social media user joked: I'll buy a lifetime's worth of condoms now. People can tell the difference between the price of a condom and that of raising a child, wrote another.

China is one of the most expensive countries in which to raise a child, according to a 2024 report by the YuWa Population Research Institute in Beijing. Costs are pushed up by school fees in a highly competitive academic environment, and the challenge women face juggling work and parenting, the study said.

The economic slowdown, partly brought on by a property crisis that has hit savings, has left families, and especially young people, feeling uncertain or less confident about their future.

Observers appear divided on the aim of the tax overhaul. The idea that a tax hike on condoms will impact birth rates is overthinking it, says demographer Yi Fuxian from the University of Wisconsin-Madison. He believes Beijing is keen to collect taxes wherever it can as it battles a housing market slump and growing national debt.

The move to tax condoms is symbolic and reflects Beijing's attempts to encourage people to lift China's strikingly low fertility numbers, said Henrietta Levin from the Center for Strategic and International Studies.

However, this approach also risks backfiring if people feel the government is being too intrusive about making deeply personal choices regarding childbearing.