Measures include exempting childcare subsidies from personal income tax, offering annual childcare support, and promoting positive views on marriage and family life through education.

China has removed a three-decade-old tax exemption on contraceptive drugs and devices from January 1, as part of new efforts to address its declining birth rate. Under the change, products such as condoms and contraceptive pills will now attract a 13% value-added tax, the standard rate applied to most consumer goods.

The move comes as Beijing struggles to reverse a demographic slowdown, with China’s population shrinking for the third straight year in 2024. Authorities have already introduced a range of “fertility-friendly” measures, including exempting childcare subsidies from personal income tax, providing annual childcare support, and encouraging educational institutions to promote positive views on marriage and family life.

China’s birth rate has been falling for decades, influenced by the long-running one-child policy that ended in 2015, rapid urbanisation, and rising living costs. High childcare and education expenses, job uncertainty, and a slowing economy continue to discourage many young people from marrying and starting families, posing long-term challenges for the world’s second-largest economy.

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