Why China Is Making Condoms and Birth Control Pills Costlier to Boost Birth Rates

China’s decision to make condoms and contraceptive pills more expensive marks a striking shift in its population policy, underscoring growing anxiety within Beijing over a rapidly shrinking and ageing population. From January 1, the Chinese government withdrew long-standing tax exemptions on contraceptive drugs and devices, subjecting them to a 13 percent value-added tax—the standard rate applied to consumer goods. The move is being seen as part of a broader strategy to subtly discourage birth control and encourage couples to have children.

For decades, China was globally associated with strict population control under its one-child policy. That era, however, now stands in sharp contrast to current efforts led by Xi Jinping, as the country struggles to reverse a demographic decline that many experts warn could threaten long-term economic stability. China’s population fell for the third consecutive year in 2024, and projections suggest the trend may persist for years.

At the heart of Beijing’s concern is the rapid ageing of society. More than 20 percent of China’s population is now aged 60 or above, a figure expected to rise sharply in coming decades, according to projections by the United Nations. Policymakers fear the country could “get old before it gets rich,” a scenario that would strain public finances, reduce workforce size and slow economic growth. Unlike developed economies facing similar ageing trends, China’s social security and healthcare systems are still evolving and remain underprepared for such pressure.

China’s fertility rate has dropped to among the lowest globally, far below the replacement level of 2.1. By 2021, it stood at roughly 1.16, reflecting a steep decline in births. Fewer children today translate into fewer workers tomorrow, weakening productivity and domestic consumption at a time when economic growth is already slowing.

The roots of this crisis trace back to the one-child policy, enforced between 1980 and 2015. Although the policy was relaxed first to allow two children and later three, decades of state control over reproduction reshaped social behaviour. Small families became the norm, marriages were delayed and the cost of raising children rose sharply. Undoing these deeply ingrained patterns has proven far more difficult than policymakers anticipated.

Public anger linked to that period still lingers. Recent online discussions on Weibo highlighted unresolved trauma associated with forced abortions and sterilisations carried out to meet population targets. Many users argue that the long-term consequences of the policy are now unfolding.

In response, Beijing has rolled out a series of “fertility-friendly” measures, including childcare subsidies, cash incentives, simplified marriage registration and expanded preschool access. Authorities have also promised to reduce childbirth-related medical costs by 2026 and regulate childcare services more strictly. Making contraception costlier fits into this approach—discouraging child avoidance without reverting to overt coercion.

Yet, resistance remains strong among young Chinese. High housing prices, expensive education, job insecurity and long working hours make parenthood feel financially risky. Marriage rates have plunged, and a growing number of urban youth openly embrace child-free lifestyles. Surveys show that many young adults, particularly women, say they do not want children at all.

Raising the price of condoms and birth control pills is unlikely to trigger a baby boom on its own. Instead, the policy highlights Beijing’s growing urgency as it grapples with a widening gap between state ambitions and a generation that increasingly views parenthood as unaffordable and uncertain.