Very few people in the United States could possibly remember a time when there were no income taxes, since Uncle Sam has been collecting them for the past 100 years now. But in the communist nation of Cuba, few people remember what it is like to pay any kind of taxes at all. Taxes are usually imposed on people who earn money for themselves and accumulate property; communists work for the state. It will be interesting to see how Cubans respond to the comprehensive new tax code that goes into effect beginning next year.
The state-run businesses which turn all their earnings over to the government appear to be on their way out in Cuba. The government will still be getting its share, but now through steep taxation instead. How someone making $2000 per year can afford to pay a 50% tax, I’ll never know. Many Cubans will need tax relief from day one, or they won’t be able to feed their families. The plan is to codify 18 other taxes as well (inheritance tax, property tax, sales tax, etc.). And what about tax collection? It is a problem in the U.S. even after 100 years, so I expect it will be an even greater challenge for the government of Cuba.