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  HOME | Cuba

Cuba Stops Issuing Licenses for Private Restaurants, Lodging

HAVANA – The Cuban government temporarily stopped on Tuesday issuing licenses to privately operated restaurants and lodging establishments catering to tourists, among other businesses, in an effort to regulate enterprises run by self-employed people, state media reported.

The measures, published in the Official Gazette of the Republic, seek to end illegal activities and “deviations,” as part of a “systematic (process) of review and improvement, undertaken to correct deficiencies ... (in) working for one’s own account” on the island, an area in which more than a million Cubans make their livelihoods, according to the state-run daily Granma.

As part of the new restrictions issued by the Cuban Labor and Social Security Ministry (MTSS), the public is also advised that the granting of licenses in several sectors will also be halted, including wholesale vendors of agricultural products and street vendors.

The announcement states that “workers who have already been authorized (to engage) in these activities can continue pursuing them.”

This effort to “improvement” autonomous work was announced at the plenary session of Parliament on July 14, when President Raul Castro said that he would not allow “stigmas or prejudices” against the budding private sector, although at the same time that he asked those workers to abide by the law and fulfill their tax obligations.

Among the licenses temporarily frozen are auto body shops, private building contractors, barter managers, real estate agents, tourist lodging managers, sports instructors, seamstresses and tailors, as well as organizers of weddings, coming-out balls and other activities.

In addition, licenses for shoemakers or -sellers, producers and sellers of various items for use in the home, music and other arts teachers, electrical and electronic repair workers, individual tutors, workers building or repairing property and “computer repair workers” will all be curtailed.

The changes come after the authorities detected frequent irregularities within the private sector – including the use of “raw materials, materials and equipment of illicit origin,” non-compliance with tax duties and under-reporting of income – and determined to put a halt to it.

To ensure that self-employed people comply with their tax and other obligations, Cuba will now demand that they open bank accounts where a record of their financial activities and dealings can be compiled.

In principle, the owners of “paladares,” or private restaurants, rental houses and private taxi drivers will all be obligated to comply with the new regulations, these being three of the activities that generate the most income.

MTSS First Deputy Minister Marta Elena Feito said that the new measures do not mean “a move backward in the development of (private economic) activity,” but rather the move is “intended to consolidate the organization and control of private labor, such that it may continue to move forward in an orderly and efficient manner.”


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