‘New self-employment measures’ talk in Cuba is just “old wine in new bottles”

The Castro regime's fear of a "functional free market economy" continues to stifle entrepreneurs on the Island.

13 Jul ‘New self-employment measures’ talk in Cuba is just “old wine in new bottles”

Diario de Cuba

ORLANDO FREIRE SANTANA | Havana | Friday, July 13, 2018

At last the authorities have spoken about what they call “the refinement of self-employment and its control system”. The measures were just announced, but they will not enter into force until the first half of December. The waiting period will serve, according to the official discourse, so that the self-employedcan study the legislation and, during the seminars that will be held, have all their questions answered.

However, these seminars are unlikely to dispel the uncertainty that plagues the world of independent unemployment in Cuba. There are still many loose ends after the official announcement, in addition to many gray areas emerging from some of the aforementioned measures.

For example, it is stated that 41 activities carried out in Havana will be subject to tax increases, but it is not specified what those activities will be. Similarly, six other activities will go from the simplified tax regime to the general one, entailing the obligation to submit a Personal Income Tax Return, but what these six activities will be is not clarified either.

Regarding the marketing of cultural products, it is clarified that “the commercialization of products of contents that are injurious to ethical and cultural values​, both visual arts and books, and that are not in accordance with Culture Ministry regulations, will be sanctioned.” Will the sellers of books whose shelves contain works by Rafael Rojas, Zoé Valdés, Guillermo Cabrera Infante and Antonio José Ponte, among others, be sanctioned?

The measures announced governing private transportation workers merit separate mention. There will be a new experiment in the capital to “reorganize” the service provided by these vehicles. Some of these taxi drivers will have to use taxi stops, and have fixed routes to travel, although it is not clear whether the rates will be free (supply-demand) or the government will cap them.

The obligation to open and have bank accounts in which to deposit the income generated by their activity has caused waves among the self-employed. The owners of restaurants (paladares) and bars, cafeterias; lessors of houses, rooms and spaces; and those who offer construction services, and taxi drivers, will have to use these accounts.

The foregoing implies that the tax authorities – firstly, the National Office of Tax Administration (ONAT) – will have information on the incomes that these self-employed people earn, at all times, such that they can inform the pertinent authorities (it has not yet been announced who) to act in order to thwart the concentration of wealth.

Incidentally, the prevention of the concentration of wealth will also be an end pursued by limiting Cubans to the performance of just one professional activity. Those self-employed workers who currently engage in more than one activity will be given 90 days from the first half of December to decide which of them to continue performing.

Among the “violations” that could cost a self-employed worker his license are those who appear in the paperwork as owners of a business, when in reality they just represent the real owner. This is to prevent the self-employed worker from, in one way or another, owning more than one business – another way to prevent the concentration of wealth.

As we can see, the hardline elements of the regime, flouting what was indicated in the definitive version of the “Conceptualization of the Socialist Development Economic and Social Model,” which accepted some self-employed persons accumulating a certain degree of wealth, are now closing ranks to prevent this from happening in practice.

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Frank Rodriguez Junior
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