Now the tax will apply to all contraceptives that previously enjoyed preferential status. At the same time, authorities are beginning to expand support for families by exempting nursery, kindergarten, elderly care, and services for people with disabilities from VAT. This means that contraception will become more expensive, while care services will become cheaper.
This move occurs against the backdrop of a growing demographic crisis: in 2024, only 9.54 million children were born in the country, which is almost half of what it was ten years ago. China's population has been declining for the third consecutive year, and authorities are trying to change the long-standing policy of birth control. In recent years, various family support measures have been introduced, such as allowances, extended parental leave, and recommendations to reduce non-medically indicated abortions.
However, the main issue, according to a study by the YuWa Institute, is the high cost of raising children. Their calculations show that raising a child until the age of 18 costs about 538,000 yuan (approximately $76,000). In the context of high living costs and labor market instability, many young Chinese are hesitant to have children.
The introduction of the new tax has sparked active discussions on Chinese social media. Some users express concerns that rising prices for contraception may lead to an increase in unplanned pregnancies and the spread of sexually transmitted diseases. The discussions are fueled by statistics from the Chinese Center for Disease Control: the HIV infection rate increased from 0.37 per 100,000 people in 2002 to 8.41 in 2021.
Other commentators note that the new measure seems symbolic and ironic: if someone cannot afford condoms, they are unlikely to be able to support a child.
Experts also view the introduction of the tax as more of a symbolic gesture. Demographer He Yafu from the YuWa Institute emphasized that the cancellation of the tax exemption is unlikely to significantly impact birth rates but reflects the authorities' desire to create a social atmosphere where having children is seen as normal, and the state expects greater civic engagement in family matters.
