Chinese authorities are introducing a value-added tax on contraceptives and drugs, including condoms, for the first time in 30 years. According to Bloomberg, this measure is an attempt by the government to halt the country's falling birth rate, which threatens economic growth.
Residents of China will have to pay 13% VAT on contraceptives.
These goods have been exempt from tax since 1993, when the country was implementing the "one family - one child" policy and the authorities were trying to limit the birth rate.
Measures to stimulate the birth rate also include amendments to the VAT law that exempt childcare services, elderly care facilities, disability service providers, and services related to marriage registration from taxation.
Bloomberg notes that the tax on contraceptives is being introduced against the backdrop of a sharp increase in HIV infections in the country. According to the Chinese Center for Disease Control and Prevention, the number of registered cases of HIV and AIDS increased from 0.37 to 8.41 per 100,000 people between 2002 and 2021.
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