The Cuban government has initiated fines against micro, small, and medium-sized enterprises (MSMEs) violating the price caps imposed on six essential goods. The Ministry of Finance and Prices (MFP) shared on Twitter several cases of businesses in the capital that were found not complying with the set prices.
One of these MSMEs is located in Havana del Este, where its owner was selling oil for 1,200 pesos, despite the state-set price being 990 pesos per liter. "A fine of 8,000 pesos was applied under Decree 30, Article 7, Section B," the tweet specified.
In another post, the MFP reported an inspection of a store in the Boyeros municipality, where oil, chicken, and sausages were being sold at prices higher than allowed. "This price control campaign continues nationwide in collaboration with other agencies, institutions, and local authorities," the statement read.
The Cuban government’s crackdown on merchants who disregard price caps has escalated to the point of urging citizens to report violators by phone. The MFP is advocating for a popular control movement, establishing communication channels in each territory for people to make reports.
These phone complaints will join an "army" of 7,000 inspectors that the MFP has prepared to enforce the regulation. This year, authorities have already closed 15 MSMEs that displayed accounting irregularities.
In the penalized businesses, authorities found poor accounting practices, such as misclassifying equipment purchases as direct expenses rather than inventory, artificially reducing the business's profitability, or issues with primary record controls like financial statements, which are often incomplete or hidden.
Judith Navarro Ricardo, a legal specialist from the National Office of Tax Administration (ONAT), revealed that some cases could lead to tax evasion charges. "If an MSME does not maintain proper accounting and fails to correctly pay its tax obligations, it shows an intent to evade, giving us the right to proceed with a report," she stated.
On Monday, the implementation of price caps on six basic products (five food items and powdered detergent) was announced as an effort to mitigate the impact of inflation on the population. The MFP’s Resolution 225/2024 set maximum retail prices for chicken, oil (excluding olive oil), powdered milk, pasta, sausages, and detergent.
Understanding Cuba's Price Control Measures
Below are some frequently asked questions and their answers regarding the Cuban government's recent enforcement of price caps on essential goods.
What are the essential goods affected by the price caps?
The essential goods affected by the price caps include chicken, oil (excluding olive oil), powdered milk, pasta, sausages, and powdered detergent.
How can citizens report businesses that violate the price caps?
Citizens can report businesses that violate the price caps through communication channels established by the Ministry of Finance and Prices in each territory. They are encouraged to make these reports via phone.
What penalties do businesses face for violating price caps?
Businesses found violating the price caps can face fines, closure, and in severe cases, charges of tax evasion if improper accounting practices are detected.