Taxation in Cuba is regulated by the Law 113 of 2012. The law establishes the form and basis of taxation in

Cuba Cuba ( , ), officially the Republic of Cuba ( es, República de Cuba, links=no ), is an island country comprising the island of Cuba, as well as Isla de la Juventud and several minor archipelagos. Cuba is located where the northern Caribbea ...

Income tax

Income tax An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Tax ...

is levied to

natural person In jurisprudence, a natural person (also physical person in some Commonwealth countries, or natural entity) is a person (in legal meaning, i.e., one who has its own legal personality) that is an individual human being, distinguished from the br ...

s who engage on economic activities outside employment for the government. For those persons, there are two tax regimes: one is based on accounted profits, and the other is a fixed monthly fee adjusted per occupation. The tax regime based on accounted profits is imposed to people with income over 100000

CUP A cup is an open-top used to hold hot or cold liquids for pouring or drinking; while mainly used for drinking, it also can be used to store solids for pouring (e.g., sugar, flour, grains, salt). Cups may be made of glass, metal, china, clay, ...

(equivalent to US$4000) and to people in some particular occupations, for example food retailing. In this regime, deductions are allowed for costs up to a limit arbitrarily set by the Minister of Finances, but also for other taxes and some base deductions. The second form is imposed to the rest of the retailers, and does not require that the entrepreneur do any kind of accounting. This form of tax is possible because the Cuban legislation only allows for rudimentary forms of economic association involving very few people, also, the kinds of activity per occupation and the occupations themselves are limited per law The Finance Minister sets preliminary monthly tax quotas based on occupation. If the amount of the preliminary tax paid during the fiscal year is higher than the final tax according to income and tax rate, no tax refund is made. That is,

tax refund A tax refund or tax rebate is a payment to the taxpayer due to the taxpayer having paid more tax than they owed. By country United States According to the Internal Revenue Service, 77% of tax returns filed in 2004 resulted in a refund check ...

s are not made in any case. Income for remittances from abroad to

s is not taxed, but income for contracts taken abroad is taxed at a 4% rate without right to any deductions.

References

{{North America topic, Taxation in Economy of Cuba