Yes, you are correct. Western Europe has responded to its declining birth rate by decreasing taxes for couples with multiple children. This is known as a pro-natalist policy, which is designed to encourage couples to have more children in order to increase the birth rate and support population growth. Other countries with low birth rates have also implemented pro-natalist policies such as financial incentives, paid parental leave, and child care support to encourage couples to have more children.
Option A, limiting migration, is not directly related to addressing declining birth rates, although it is a policy that some countries have implemented to address other issues related to immigration.
Option B, raising the retirement age, is a policy aimed at addressing the challenges of an ageing population and is not directly related to increasing the birth rate.
Option D, outlawing birth control, is not a policy that is considered in Western Europe as it would be seen as a violation of individual rights and reproductive freedom.
Option E, fining families with only one child, is not a policy implemented in Western Europe as it would be seen as discriminatory and counterproductive to addressing declining birth rates.