So starting October 1st, Cubans will finally be able to buy and sell used cars from one another. The move is part free-market reforms that President Raul Castro has implemented to save the country from economic ruin.
Of course, the used car market won’t be all that “free”. The state will take a cut from every transaction, bureaucracy will complicate things further, and it seems that while anyone will be able to sell a car, not everyone will necessarily be able to buy one. As the Sydney Morning Herald reports:
CUBA has legalised the sale and purchase of cars for all citizens, another major step in the communist-run island’s economic transformation.
Under a new law that takes effect tomorrow, buyers and sellers must each pay a 4 per cent tax, and buyers must make a sworn declaration that the money for the purchase was obtained legally.
Unrestricted sales had previously been limited to cars built before the 1959 revolution, one of the reasons Cuba’s streets are about the only place on the planet one routinely finds a multitude of American classics from the 1950s such as Chevrolet Bel Airs and Chrysler Imperials, all in various states of disrepair.
Buyers will still have to go to a small number of state-owned dealerships and demonstrate they made the money to buy the car through salary earned in an approved field, as opposed to from remittances sent from relatives abroad. That would seem to limit purchases to the those who had been eligible to import cars following official travel abroad.
I guess it’ll be interesting to see if the shortage of eligible buyers will drive prices down enough that the used car market corrects itself, but something tells me that The Revolution wouldn’t stand for such unchecked market forces. But we shall see…