Taiwan Announces 18 Policies to Address Population Crisis and Low Birth Rate

To address the low birth rate, President Lai Ching-te announced on May 27 the "18 Policies to Tackle the Population Crisis and Low Birth Rate." The goal is to strengthen support for citizens during three key life stages: "childbearing, child-rearing, and education." This will be implemented through four main approaches: "increasing subsidies, reducing burdens, enhancing flexibility, and expanding care services," covering five key dimensions: "peace of mind in childbearing and child-rearing, building a comprehensive early childhood care system, increasing education funding, creating a family-friendly work environment, and reducing housing burdens." The government's objective is to promote equal co-parenting and balance employer-employee relations by fostering a family-friendly work environment, ensuring adequate support for those who wish to start a family and have children, so that "work" and "family" are no longer mutually exclusive choices. 1. "Peace of Mind in Starting a Family" Dimension: The government has proposed four policies to provide tangible economic and care support to citizens. The first policy is the "Youth Growth Subsidy for ages 0-18, NT$5,000 per person per month." This is tiered by age: children aged 0-6 will receive the full NT$5,000 in cash, while children aged 6-18 will receive half, NT$2,500 in cash, with the other half deposited by the government into a youth growth savings account, guaranteed with a minimum return equivalent to the 2-year fixed deposit rate. Upon reaching 18 years of age, this account can be withdrawn as a "coming-of-age gift" from the government to the younger generation, intended to support their next life stage, such as university education, vocational training, starting a career, or entrepreneurship. Concurrently, the government is increasing support for vulnerable children. In addition to the growth subsidy, it is promoting the "Vulnerable Children's Education Account" policy. Parents can voluntarily deposit NT$500, NT$1,000, or NT$1,250 monthly, and the government will match it 1:1, like a "half-and-half" account. The deposited amount will double. This policy will continue until the child turns 18, aiming to provide vulnerable children with more startup capital for a stable transition into adulthood. For families facing infertility, the government will continuously increase "IVF subsidies." After the child is born, the government will provide a childbirth subsidy of NT$100,000 per pregnancy; for twins, it will be NT$200,000. 2. Early Childhood Care System Dimension: The government has proposed three policies to build a support network from postpartum care to affordable early childhood care services. The newly introduced "Youth Growth Subsidy for ages 0-18" will run concurrently with the "Child-Rearing Subsidy for ages 0-6 Version 2.0." This means that children aged 0-6, in addition to receiving NT$5,000 monthly from the new growth subsidy, will also receive the "Child-Rearing Subsidy for ages 0-6 Version 2.0," which provides NT$5,000 for the first child, NT$6,000 for the second, and NT$7,000 for the third child per month. They can also apply for subsidies for childcare at public and semi-public daycare centers. The central and local governments will continue to collaborate to expand the capacity of affordable childcare centers, ensuring that childcare is not something families have to seek out, rely on luck for, or wait in line for. Currently, Taiwan's central and local governments have established a total of 206 childcare centers. The government will continue to improve regulations, allocate suitable spaces, and promote cross-agency workplace childcare systems to enhance the coverage and efficiency of public childcare services. This year, the government has promoted "Workplace Childcare Measures" to encourage the private sector to upgrade various childcare services. For example, it offers subsidies of up to NT$5 million to companies establishing new childcare centers and includes the creation of a family-friendly work environment as a criterion for evaluating the ESG performance of listed companies. Furthermore, the government is increasing tax benefits, allowing businesses to deduct up to 200% of childcare expenses. The goal of this policy is to foster a warm and family-friendly work culture, allowing parents to bring their children to work with peace of mind. 3. Education Funding Dimension: The government has proposed four policies to invest in the younger generation, ensuring that every child has equal opportunities for growth and development. From compulsory education to higher education, the government will continue to alleviate parents' educational burdens by implementing free 12-year compulsory education, subsidizing tuition and fees for students in private higher education institutions, and providing university housing subsidies to build a solid educational foundation for children and youth. For those still burdened by student loans, the government will promote measures to "reduce interest rates by 1% and extend repayment periods by an additional year," enabling young people to transition into their new lives more comfortably and pursue their dreams with greater courage. 4. Family-Friendly Workplace Dimension: The government has proposed five policies to comprehensively support citizens' work and family lives. After a child is born, a major challenge for every family is choosing between work and childcare. To give parents more rest time, the government has extended marriage leave, maternity leave, and paternity leave. "Maternity leave" has been extended from the original 8 weeks to 12 weeks. Some mothers may worry about the impact of extended leave on their careers; therefore, during the additional 4 weeks, mothers can consider returning to work early based on their physical condition and needs. Regarding parental leave, the applicable age range has been extended from 0-3 years to 0-6 years. Both parents can apply for leave on a daily basis, and the number of leave days has been increased from 30 to 60 days, totaling 120 days for both, providing greater flexibility in childcare. After both parents receive 6 months of unpaid parental leave benefits, they can each apply for an additional 3 months from the labor insurance system. The government has also raised the ceiling for the salary base used for insurance calculations, meaning that in some cases, labor insurance benefits may exceed NT$40,000. As children grow, families face challenges with school pick-ups and drop-offs. Therefore, the government is promoting "flexible working hours" or reduced working hours for childcare, which was previously only available for children aged 0-3 but has now been extended to age 12. This allows parents in need to leave work an hour earlier to pick up and care for their children. The government will compensate for the income lost due to reduced working hours, ensuring quality time with children for everyone. Meanwhile, the government will provide subsidies to companies for short-term replacement labor when employees take marriage leave, paternity leave, parental leave, or reduced working hours, offering NT$800 per person per day. For small businesses with no more than 200 employees, if they hire long-term replacement labor, the government will subsidize NT$20,000 per person. 5. Housing Burden Dimension: The government has proposed two policies to ensure stable housing, encouraging people to start families and have children. In addition to tax deductions for children under six and an additional 50% tax exemption for individuals aged 70 and above, a further 50% tax exemption has been added for minor children, increasing the exemption for minors to NT$151,500. This will help families with children reduce their tax burden. The government will empower local authorities to reduce or exempt property and land taxes for families who are married and have children. Furthermore, 40% of social housing will be expanded to "housing for married and child-rearing families," prioritizing couples married for less than 2 years and families with minor children. Families with children aged 0-6 can reside there for up to 12 years. Regarding rent subsidies, couples married for less than 2 years will receive a 1.5 times increase in support; for example, NT$4,000 would increase to NT$6,000. Families with newborns will receive a 2 times increase; for example, NT$4,000 would increase to NT$8,000. If another family member is added, an additional 0.5 times will be granted. The maximum subsidy can cover the full rent.