China wants more babies. Many more. Enough to increase their birth rate and stop the population loss which has allowed India ahead as the most populous nation on the planet. After repealing his ‘one child’ policy and display a wide range of measurements pro-natalism at a political, social and economic level, Xi Jinping’s Government has made a radical decision: make condoms more expensive and other contraceptive items. By first time in 30 yearswhoever wants to buy them will no longer enjoy a VAT exemption.
In summary: sex becomes more expensive…at least the insurance.
Sex with a condom? Pay more. have sex you will be more expensive in China from now on. At least if you want to do it with contraceptives. In the context of a broader tax reform that basically affects the value added tax (our VAT), Xi Jinping’s Government has decided remove exemption tax that condoms enjoyed until now.
The decision is not exactly new. The law on which it is based was approved at the end of 2024, but it is now generating noise on social networks and the media for a very simple reason: its effects will begin to be felt shortly, from the January 1, 2026which is when Chinese couples will encounter rising prices on contraceptives.
One figure: 13%. The change is important because this type of contraceptive items enjoyed a VAT exemption since 1993when China implemented the rate nationwide. From now on the scenario will be different and those who want to buy condoms will find themselves with a VAT of 13%.
Today, precise Guardiana package of standard prophylactics costs between 40 and 60 yuan ($5.7-8.5). The contraceptive pill, available in the country without a prescription, ranges between 50 and 130 yuan, from 7.1 to 18.5 dollars.
The price increase will not be exorbitant, but it has generated criticism on networks such as Weibo. “I was very angry when I saw that condoms were going to have taxes and increase in price,” he complained recently a user on RedNote. “Is it so easy to profit from us workers? I got so angry that I placed an order at night for the condoms that I like… I accidentally bought too many.”
Why now? The million dollar question. The Chinese government has not simply imposed taxes on condoms. The measure is framed in a broader initiative that seeks to modernize the tax system and check the list of products and services exempt from VAT. At the end of the day, the consumption tax represents a crucial part of the tax revenues that feed the Chinese coffers.
All in all, it is striking that Beijing decides to make contraceptives more expensive precisely at a time when the country loses population and look for ways to encourage their birth rate, which has led the State to act as a matchmaker, help to couples with babies or even go household by household to encourage women to have children.
It has also not gone unnoticed that the same tax reform contemplates a tax reduction for childcare services. There is more at stake than Chinese demographics: there is the country’s economy, supported by its enormous domestic market, and the challenge of what to do with million pensioners.
“Unlikely”. The other question is… Does the Government really expect that applying a 13% tax on condoms will result in more babies? An IndexBox report shows that in 2020, close to 5.4 billion condoms. There is who thinkslike Quian Cai, from the University of Virginia, that a price increase may “reduce access” to contraceptives, especially among the poorest population, but warns of the consequences.
“It could lead to more abortions and increased health care costs,” prevents Cai. The risk? That in an attempt to increase the birth rate, China finds itself with more terminations of pregnancies and a resurgence of diseases sexually transmitted. Others are simply skeptical that making condoms more expensive is going to influence the number of pregnancies, especially if one takes into account that one of the brakes on birth rates is the high cost of parenting.
“The tax itself is unlikely to have a noticeable effect on birth rates,” explains to TIME Yuan Mei, professor at the School of Economics, Singapore Management University. “Decisions about having children in China are mainly influenced by economic and lifestyle factors, such as the cost of raising a child and long working hours. These factors outweigh small changes in the price of condoms.”
So what for? There is who considers that the rate has a symbolic nature and really seeks to delve into a message. “Now that China’s birth policy has shifted toward promoting birth and no longer promotes contraception, it is reasonable to tax condoms again,” reflect He Yafu, Guangdong demographer. Nor does it seem that the initiative will have a notable economic impact. Not at least if you put it in context.
Lee Ding of Dezan Shira & Associated explains to Guardian that taxing condoms will add around 5 billion extra yuan a year to state coffers (about $710 million). It is a considerable figure, but very small when compared to the billions that the country collects in general. “We don’t believe that income generation is the main motivation.”
Images | Fenghua (Unsplash) 1 and 2 and CDC (Unsplash)
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