China has imposed a value-added tax (VAT) on condoms and other contraceptives for the first time in three decades as part of its efforts to boost the birth rate and modernize its tax laws. The measure takes effect on January 1, when condoms and contraceptives will be subject to a 13% VAT – a levy this product has been exempt from since China introduced its national VAT system in 1993.
The move is included in a VAT law approved in 2024, designed to update China's tax system. VAT accounts for nearly 40% of China's total tax revenue. After nearly three decades of strict birth restrictions under the "one-child policy" (population control measure limiting families to one child), China has rolled out a series of incentive-based measures over the past decade to encourage births. These include raising the permitted number of children per couple to three and, in some provinces, offering subsidies for in vitro fertilization treatments and food allowances for additional children. Several local authorities grant young couples extra paid leave days to encourage marriage.
However, the fact that condoms and contraceptives are set to become more expensive has sparked ridicule on social media. One user on Weibo (a popular Chinese social media platform) wrote, "Are they really going this far just to make us have children?" The new VAT law also includes tax breaks for childcare and marriage matchmaking services.
This year, the government allocated 90 billion yuan (approximately $12.7 billion) to a first-of-its-kind national childcare subsidy program, offering 3,600 yuan annually per child up to age 3. On Saturday, the government announced plans to expand the national health insurance system to cover all birth-related expenses.
Despite the incentives, their impact on the birth rate has been minimal. In 2024, the birth rate stood at 6.77 per 1,000 people – a slight increase from 2023, but still a historically significant low figure. A high mortality rate resulting from an aging population means China's population has been shrinking for at least three years.
Now, concerns are emerging that authorities are turning to the "stick" to achieve the national birth target. In several regions, women have reported receiving phone calls from local authorities requesting information about menstrual cycles and pregnancy plans. In December, women in Yunnan province in southwest China were required to report the date of their last menstrual period to local authorities. The local health bureau claimed the data collection was necessary to identify pregnant women and expected births.
Social media responses included: "Today they require all women to report menstrual dates, tomorrow they'll demand reports on when sexual intercourse occurs, and the day after they'll call demanding intercourse during ovulation. This is mass breeding."
The tax increase on condoms is considered a symbolic move. A typical package of condoms costs 40-60 yuan (approximately $5.70-$8.50), and a birth control pill, available without a prescription, costs 50-130 yuan per monthly package.
Yun Zhou, a social lecturer at the University of Michigan, noted that the new tax will likely not affect people's decision-making processes, but it signals the government's position on "what constitutes desirable family behavior." Zhou added that if access to contraceptives becomes challenging, "the negative impact will fall primarily on women, especially women from vulnerable populations."
