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'No child tax' on childless citizens
Published on: 2018-08-27
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050A controversial proposal to tax Chinese couples without children has sparked public outcry.
 

As China faces faltering birth rates and an ageing population, Hu Jiye, a finance professor at China University of Political Science and Law, said in an interview that the Chinese government should consider imposing a 'no child tax' on DINK (Dual Income, No Kids) families for future social support funds.
 

'These DINK couples have no offspring to take care of them once they grow old and therefore will consume social resources,' Hu told Chinese online portal Sohu's think tank on Thursday. 'That's why DINK families should be taxed.'

Chinas government used to have a one child policyChina's government used to have a one-child policy

Hu also supported the idea of a 'fertility fund' floated by two academics where the government should tax working adults below the age of 40 to subsidise families having a second child.
 

The childbirth fund proposal was was co-authored by Nanjing University economic professors Liu Zhibiao and Zhang Ye.
 

The article, titled 'Boosting fertility: a new task for China's population development in the New Era', stated that all citizens below the age of 40, regardless of gender, should contribute a certain percentage of their salary each year to the birth fund.

The proposal has been met with a great deal of criticismThe proposal has been met with a great deal of criticism

'Families having a second child can apply to draw money from the fund as compensation for the income loss the woman and her family incur during the maternity period,' the authors proposed.
 

'If a family decides to not have a second child, the couple can withdraw the money deposited in the fund upon retirement,' the article stated, adding that the government should immediately remove all birth limits as a short-term response to the country's declining birthrate.
 

The suggestions come amid a nationwide campaign to encourage families to have more children in a country that has just stepped away from a four-decade long one-child policy.

052The proposals sparked furious debates on social media among Chinese citizens, who were growing tired of drastic changes in the country's family planning policies.
 

Many slammed that the 'no child tax' is outright unreasonable while others condemned that the fertility fund is unfair to families who prefer having less than two children.
 

'People were fined and forced to get abortions when the country didn't want children. Now, they're forced to have more children and could even get taxed. What a ridiculous proposal!' one commented. 'Should people who were fined during the one-child policy era get their money back?'
 

'What kind of expert is this? There are many reasons for a couple to decide against having a second child, such as health, wrong timing, etc. He is overgeneralising.'
 

Beijing abandoned the controversial rule in 2016 to allow all families to have two children, but the country's birth rate last year dropped to a 'shockingly low level' instead, contrary to the government's expectations.

051Currently, even if parents are permitted by law to have more children, many decided against doing so because raising a child has become too expensive.
 

The surprising outcome has prompted the government to roll out policies including government subsidies and tax reductions in recent months for eligible couples in a bid to rejuvenate its greying population and shrinking workforce that could threaten its economy.
 

For example, all of the 'second child' in Xianning in central China could enjoy free tuition fees when they go to the kindergarten, according to a latest government document released in early August.
 

Couples in Xianning could enjoy extra housing benefits from the government and a better mortgage rate when buying a new home. Second-time mothers there could also have an extended maternity leave up to six months, the report said.
 

Last year, the number of births in mainland China slipped 3.5 per cent to 17.23 million, compared with 17.86 million in 2016; while the birth rate - the number of live births per thousand of population per year - dropped from 12.95 in 2016 to 12.43, according to the National Bureau of Statistics of China.
 

In comparison, the birth rate of India - the world's second populous country after China - was 19 per thousand people in 2017. India's population is expected to surpass that of China in 2024, according to a UN forecast.

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