Starting January 1st, Chinese citizens will face a 13% sales tax on contraceptives, while childcare services will be fully exempt.
This change is part of a major overhaul of China’s tax system aimed at addressing a deepening demographic crisis.
The new policy removes long-standing exemptions dating back to 1994—a period when China was still enforcing its strict one-child policy.
The shift signals a stark reversal, as the government now actively discourages contraception to promote higher birth rates.
The tax reforms extend beyond contraceptives and childcare. In a bid to reduce the financial burdens on families, the government has also exempted marriage-related services and elderly care from value-added tax (VAT).
These measures are part of a broader national strategy that includes extended parental leave and direct cash subsidies for families with children.
China is grappling with a rapidly ageing population and sluggish economic growth.
For years, Beijing has implemented various incentives to encourage young people to marry and start families earlier, aiming to reverse a declining birth rate that threatens long-term economic stability.
By James Kisoo
