14ymedio, Havana, January 17, 2024 — The Cuban Government announced on Tuesday the reduction from 5% to 2% of the tax on the wages of private ranchers and farmers. The measure, announced on State TV’s Round Table program by the directors of the National Tax Office (ONAT), responds to a strategy to stimulate the depressed agricultural sector of the Island, which imports about 80% of the food it consumes.
Juan Carlos Vilaseca Méndez, deputy head of the ONAT, explained that, as stated in the Official Gazette, the reduced tax will be applied to the gross income of landowners and usufructuaries [leasers] of State land, as well as to landless livestock holders and other private food producers, including sugarcane farmers. That is, once the expenses have been subtracted – as long as 80% of these can be justified – from the taxes and the tax withholdings that the farmers had throughout the year, then another 2% can be deducted.
The tax on retail sales of agricultural products in municipalities and popular councils where the authorities have centralized prices will also fall from 10% to 5%. The “bonus,” as stated in the law, aims to convince producers and merchants to sell in the State market rather than in the informal one.
Two years after the creation of the private enterprises, the communists set out to increase the revenue, jeopardizing the viability of many of these entities that are still weak
The ONAT authorities alluded to the new measures as something revolutionary that will allow the Cuban economy to be channeled, especially at a time of great reforms. However, in an analysis of the new tax and budgetary rules of the State, the Cuban economist Elías Amor offered a
completely different assessment of the perks to producers. According to him, the difference between what was paid before and what the producers will deliver this year “will in no way stimulate agricultural production.”
The Official Gazette also confirms the end of tax exemptions for the private enterprises and non-agribusiness cooperatives at the end of six or 12 months. This was mentioned at the time that the benefit was implemente
