For the first time in 30 years, China has announced that it will impose a tax on condoms and other contraceptive products. The move to boost birthrates raises serious public health concerns, according to The Guardian.
From January 1, condoms and contraceptives will be subject to a 13% VAT rate, a tax these products have been exempt from since China introduced nationwide VAT in 1993.
The measure was included in a VAT law passed in 2024 in an effort to modernize China's tax regime. VAT represents almost 40% of the total tax revenues of this country.
After enforcing a strict one-child policy for families for three decades, China has in the past decade introduced a series of “stimulus measures” to encourage the population to have more children in an attempt to boost the declining birth rate.
In addition to raising the limit on the number of children allowed per couple to three, provinces have experimented with offering discounts on IVF treatment and cash subsidies for more children. Some local governments even offer additional days of paid leave to newlyweds.
But the idea that condoms and contraceptives will become more expensive has been ridiculed on social media. “What is happening to modern society? They are doing everything to make us have children,” one user wrote on Weibo.
The new VAT law also includes a tax break for childcare and “marriage services”.
This year, the government allocated 90 billion yuan ($12.7 billion) for its first national childcare subsidy program, providing 3,600 yuan a year for each child under the age of three. On Saturday, the government announced plans to expand the national health insurance program to cover all childbirth-related expenses.
But the incentives had little effect. In 2024, the birth rate was 6.77 per 1,000 people, a slight increase from 2023, but still well below historical levels. Rising death rates caused by an aging population mean China's population has been declining for at least three years.
The negative effects will be borne “particularly by disadvantaged women”
Currently, there are concerns that the authorities could resort to “drastic measures” to achieve the national policy goal of increasing the birth rate, writes The Guardian.
Women in some areas reported receiving phone calls from local government officials asking them about their menstrual cycle and plans to have children. In December, Chinese media reported that women in a county in southwest China's Yunnan province were required to report the date of their last period to local authorities. The local health office said the data collection was necessary to identify pregnant women and expectant mothers.
The condom tax hike is largely symbolic. A typical pack of condoms costs 40-60 yuan ($5.70-8.50). The contraceptive pill, which can be bought without a prescription, costs 50-130 yuan ($7.10-18.46) per month's supply.
“Now that China's birth policy has turned to encouraging births and no longer promotes contraception, it is reasonable to resume taxing contraceptives,” said He Yafu, an independent demographer in Guangdong province. “However, this measure is unlikely to have a significant effect on increasing the fertility rate.”
Yun Zhou, an assistant professor of sociology at the University of Michigan, said the new tax is unlikely to affect people's decisions, but that it signifies from the government “what should be desirable family behavior.” Zhou added that if access to contraception becomes difficult, “the negative effects will be borne by women, especially disadvantaged women.”
Source: Dreamstime.com
