Cuba Privatizes State Taxi Services

HAVANA TIMES — This year the Cuban government hopes to convert the drivers of twenty state taxi agencies into self-employed taxi drivers, reports dpa news on Wednesday.

The reform, published in the official Granma daily provides that state agencies throughout the island lease their vehicles to drivers who will no longer on the state payroll and will operate as “self-employed.”

The measure will be implemented “gradually” throughout 2014, said Granma. With this, the authorities aim to overcome problems including shortcomings in the state taxi services, corruption and overstaffing, the report said .

In principle, the plan involves the privatization of services provided in convertible pesos (CUC), the hard currency of the island, widely used in the tourism sector. The drivers will now rent vehicles from the state and pay taxes.

“Under this system, the drivers assume, with their income, maintenance and fuel costs and part of the vehicle repairs, while they may take passengers where they deem convenient, paying taxes depending on their income,” explained Granma.

The newspaper did not specify if the state will maintain a percentage of the state sector taxis operating as it did before.

According to Granma, the country will continue providing certain services in regular Cuban pesos (CUP), for example at hospitals. The CUP is the official currency in which state salaries and pensions are paid.

In addition to the state taxi services on the island many “self-employed” provide service with private cars, usually old US-made vehicles from the 1940s and 50s, also in CUP.