China to tax condoms at 13%, ending a 30-year exemption. Here’s a bite-by-bite breakdown

China will now levy a 13% value-added tax on contraceptive drugs and products, ending an exemption that has been in place since 1993.

Notably, the change, tied to the country’s newly revised VAT law, will take effect on January 1 and marks a clear pivot: from decades of discouraging births to now worrying about a shrinking population.

Simply put, China’s decision to tax contraceptives is part of a broader attempt to confront plunging birth rates that are beginning to threaten economic stability. During the years of the one-child policy, Beijing invested heavily in promoting contraception, ensuring widespread and often free access to birth control across the country. But in China, deaths have outnumbered births, and India officially overtook China as the world’s most populous country in 2023.

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China’s population has declined for three consecutive years

Just in 2024, China recorded only 9.54 million births, almost half of the 18.8 million births reported nearly a decade earlier, soon after the one-child policy was lifted, according to Bloomberg. To counter this slide, Beijing raised the permitted number of children from one to two in 2015, and again to three in 2021. But the policy changes have not translated into a baby boom.

Now, contraceptive items like condoms will fall under the standard 13% VAT bracket applied to most goods.

One specialist told the Associated Press that “Higher prices may reduce access to contraceptives among economically disadvantaged populations, potentially leading to increases in unintended pregnancies and sexually transmitted infections. Those outcomes could, in turn, lead to more abortions and higher health-care costs.”

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China is already witnessing a rise in sexually transmitted infections after a temporary drop during the COVID years. In 2024 alone, the country reported more than 100,000 gonorrhoea cases and 670,000 syphilis cases, according to the National Disease Control and Prevention Administration.