HONG KONG — China has taken another bold — and controversial — step in its effort to reverse a deepening population crisis.
Starting January 1, Beijing removed a three-decade-old tax exemption on contraceptive drugs and devices, a move aimed at encouraging more births as the country’s population continues to shrink.
From now on, condoms and contraceptive pills will be subject to a 13% value-added tax, the same rate applied to most consumer goods.
The decision comes at a critical time.
China’s population fell for the third straight year in 2024, and experts warn the decline is far from over. Despite being the world’s second-largest economy, the country is struggling to convince young people to marry, have children, and start families.
In response, the government has been rolling out a wave of so-called “fertility-friendly” policies.
Last year, China exempted childcare subsidies from personal income tax and introduced an annual childcare allowance. Universities were even urged to offer “love education” — programs designed to present marriage, family life, and parenthood in a more positive light.
Just last month, China’s top leaders doubled down on the message. During the Central Economic Work Conference, they pledged to promote “positive marriage and childbearing attitudes” as part of a broader effort to stabilize birth rates.
But the roots of the problem run deep.
China’s birth rate has been declining for decades, shaped by the long shadow of the one-child policy, which was enforced from 1980 to 2015, and by rapid urbanization that changed family life and priorities.
Today’s challenges are just as powerful.
The high cost of childcare and education, growing job insecurity, and a slowing economy have left many young Chinese hesitant — or unwilling — to marry or raise children.
As Beijing tightens policies and sends stronger signals, the question remains:
Will financial pressure and social messaging be enough to change deeply personal choices?
For now, China continues its search for answers — one policy at a time.
