China to allow tax deductions for care of small children to help boost births
China will allow tax deductions for expenses on children under three as part of a major relaxation in child-bearing policy to stem a dramatic decline in births in the world’s most populous country, an official document showed on Tuesday.
Beijing announced on May 31 that it would permit married couples to have up to three children, rather than just two.
It scrapped a decades-old one-child policy in 2016 in favour of a two-child limit to try and stave off risks to its economy from a rapidly ageing population. But that failed to yield a sustained jump in births given the high cost of raising children in Chinese cities, a challenge that persists to this day.
China had a fertility rate of just 1.3 children per woman in 2020, recent data showed, on a par with ageing societies like Japan and Italy and far short of the roughly 2.1 needed for replacement level.
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