Economy 10-07-2018

Cuba announces new rules for the private sector and resumes the delivery of licenses

The Cuban government published today a set of twenty measures to "reorder" its growing private sector, which will allow to group and expand the profile of permitted activities and resume the delivery of licenses, which has been paralyzed for almost a year.

The new rules will come into force five months after their publication in the Official Gazette, when they will also resume the granting of new licenses for self-employed workers suspended in August last year, state media reported.

The Executive assured that the new regulation will have the dual function of continuing to develop the private sector so that it will contribute more to the public treasury and pursue the illegalities that were being committed, such as the use of "illicit proceeds", tax fraud or the use of of frontmen.

When the regulations come into force (expected in December), the 201 self-employed activities allowed in Cuba will be consolidated in 123 for "a reduction in procedures", without eliminating any of the current ones.

Three new trades are allowed: baker-confectioner, landlord of means of transport and bar and recreation service, which is now derived from the more general license for private restaurants or "palates".

On the contrary, "the decision not to grant new authorizations" is ratified for the activities of wholesaler or retailer of agricultural articles, operator of rural recreational equipment, street vendor of agricultural products and buyer-seller of discs, publishes the state newspaper "Granma"

Among the new measures of the Ministry of Labor and Social Security of the island highlights the lifting of the limitation that prohibited landlords from renting to legal entities.

The number of self-employed workers amounted to 591,456 in May, according to official data, which represents a strong growth since the 157,531 in 2010 and now represents 12% of the country's workforce.

The majority of private businesses focus on the preparation of food and meals, transport and leasing of homes, in part to serve the more than 4 million tourists who visit Cuba every year.

The new measures also include modifications to "order" the transport of passengers, one of the most sensitive issues on the island, where a valid driving license will now be required as a requirement and the territorial scope of the license will be limited.

An "experiment" will also be put into effect in December in Havana, which includes more than 6,000 self-employed drivers who drive passenger vehicles in the capital and consists of grouping the service into twenty-six terminals with twenty-three associated routes.

To be included, drivers must open bank accounts and have the benefit of being able to purchase tools, components, parts and fuel at subsidized prices.

The Cuban government also published several "tax adjustments" that seek to define the monthly fees and deductible expenses for the new jobs now grouped under a single license and eliminate the exemption from payment for the use of labor force, in the case of the "cuentapropistas" that employ one or more workers in their businesses.

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