China is set to impose a 13% sales tax on condoms, birth control pills and contraceptives from January 1, 2026, ending a three-decade exemption. The policy shift is aimed at reversing the country’s falling birth rates and mitigating the long-term effects of an ageing population and shrinking workforce.
Government push for a baby boom
Alongside the tax change, authorities are rolling out incentives to encourage childbirth. These include tax exemptions for childcare services, elder care institutions and disability service providers, as well as longer maternity leave, which has increased from 128 days to 158 days in major cities such as Beijing. A 30-day paid paternity leave has also been proposed.
Economic pressures weigh on young adults
Despite these measures, economic realities remain a key deterrent. A challenging job market and the high cost of raising a child continue to discourage many young people from starting families.
From one-child policy to baby-friendly policy
China’s baby-friendly policies mark a sharp contrast with its one-child policy, enforced for decades over resource concerns. That policy, which ended in January 2016, led to steep declines in birth rates and included penalties such as heavy fines, forced abortions and sterilizations. Children born outside the policy often lacked official registration, limiting access to healthcare, education and travel.
Population decline persists
Even after easing restrictions to two children in 2015 and three in 2021, China’s population has continued to shrink. The country, now home to about 1.4 billion people, has seen population declines for three consecutive years.
