US Dollar Now Worth 10% More in Cuba

Cuba lifts 10-per-cent tax on US dollars, broadens currency use

HAVANA TIMES – Cuba on Thursday said that it will eliminate a long-standing 10-per-cent tax that it put on the official US dollar exchange rate and accept the use of the greenback in some stores, reported dpa news.

“This is a measure that benefits all Cubans inside and outside the country,” Cuban Economy Minister Alejandro Gil said on state television.

Cuban authorities acknowledged that the decision, designed to bring in more hard currency, was fuelled by the Covid-19 pandemic and the loss of tourist revenue. They stressed that the measure did not represent a “dollarization” of the country’s economy.

The 10-per-cent tax has been in effect since 2004. It ended up promoting an informal parallel market.

From Monday, about 72 of the 4,800 state-controlled stores in Cuba will be able to sell food and toiletries in US dollars, although not in cash but via bank cards connected to US-dollar accounts.

Sales of household appliances and cars had already been offered in the US currency at selected stores since last year, as part of efforts to counter the use of dollars on the ilicit market.

President Miguel Diaz-Canel assured the Council of Ministers that the new measures did not disadvantage the large sector of the Cuban population that does not have access to the dollar.

The sale of products in national currency would go on, promised Diaz-Canel.