Sunday, July 29, 2012

861. Cuba's National Assembly Adopts First New Tax Code Since 1959 and Approves Plan on Cooperatives

Meeting of Cuba's National Assembly

By Cuba Central Newsblast, July 28, 2012

The National Assembly adopted a new tax code, the first comprehensive tax code passed since 1959, during the first session of the biannual meeting of Cuba's parliament, reports Reuters. Under the new plan, all Cubans will eventually be required to pay income and property taxes for the first time in more than 50 years. The new tax code will also cut taxes for small business by 3-7% and provide benefits for start-ups, such as eliminating the labor tax for business with five employees or less.

Marino Murillo, Chairman of Cuba's Economic Policy Commission, said during his presentation that some state companies will have more autonomy, will be slightly deregulated, and will be able to sell extra production to an open market after fulfilling state contracts.

Murillo also announced during the parliamentary meeting that a pilot program of 222 non-state cooperatives in various sectors, including food services and transportation, will be implemented by the end of this year, reports the Associated Press.

The cooperatives will lease property and equipment from the state for 10-year increments, function on a market basis, pay taxes, and split profits among members, Reuters reports. Murillo promised that the pilot program will receive the full support of the government, pledging, "For these cooperatives and the non-state entities, in the coming year $100 million is being budgeted which is the financing necessary so they can be assured production, because if we create them and there is no financing, they won't work." He also emphasized the importance of improving state-run enterprises because they will continue to be the most important part of the economy.

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