Editor’s Note: This article was originally featured in On Balance, the ARTnews newsletter focusing on the art market and more. To receive this newsletter every Wednesday, sign up here.
For almost a year, European art dealers and market observers have been raising concerns about a new European Union regulation, Directive 2022/542, which aims to standardize the value-added tax system among member states. The directive officially came into effect on January 1, but responses from member states have varied.
Under Directive 2022/542, member states have the option to lower taxes on art sales as long as the rate is above 5 percent, but they must also abandon their previous complex tax systems. France and Germany have reduced or maintained their VAT on art sales to 5.5 and 7 percent, respectively. In contrast, the Netherlands plans to increase their VAT, while Belgium and Italy have not yet announced their plans. The EU governing body is not expected to penalize members for not meeting the January 1 deadline to implement the new VAT system, allowing tardy countries to continue with their previous systems. However, the impact of the new VAT system, which allows for some flexibility in implementation by each country, is expected to have varying effects on different regional art markets.
Austrian dealer Thaddaeus Ropac highlighted the significant influence that VAT rate variations can have on local art scenes and the success of artists‘ gallery shows. He noted that collectors may be attracted to countries with lower VAT rates for art transactions, indicating that the new VAT system is likely to bring about changes in the art market.
Following Brexit, France has become a major player in European art sales, accounting for over 50 percent of all sales in Europe. Germany is the next largest seller, comprising around 2.5 percent of global art auction sales in 2023. Both countries have led the way in VAT reforms, with France implementing a more favorable 5.5 percent VAT rate on art transactions and Germany reducing its VAT from 19 percent to 7 percent.
Belgium is considering imposing a 21 percent VAT on artworks, potentially harming the art market. Patrick Mestdagh, president of Belgium’s Royal Chamber of Art Dealers, warned that such a move could have devastating effects on the market, as it would create a significant price difference compared to countries with lower VAT rates.
Local organizations in Belgium, including ROCAD, have been advocating for a lower VAT rate to prevent negative consequences for the art market. The Belgian government is yet to make a final decision on the VAT issue.
The new EU directive allows member states to apply reduced VAT rates across the board, if desired, or maintain or raise standard VAT rates. France’s simplified 5.5 percent VAT is seen as beneficial for the art sector, benefiting not just dealers but also museums, according to Gaëlle de Saint Pierre of the Comité Professionnel des Galeries d’Art in Paris. Die CPGA war unter den Organisationen, die die französische Regierung lobbyierten, um die Mehrwertsteuer zu senken.
„Es wird wirklich zu einem transparenteren, klareren System führen, das bisher für Fachleute ziemlich komplex war“, fügte de Saint-Pierre hinzu.
„Wir hatten wirklich gehofft, dass Frankreich in dieser Hinsicht eine Art Vorreiter sein würde und dass andere Länder folgen würden, weil wir gerne gleiche Wettbewerbsbedingungen hätten“, sagte Erika Bochereau, Generalsekretärin der Confédéreation Internationale des Négociants en Oeuvres d’Art (CINOA), die Tausende von Unternehmen im Kunsthandel vertritt. Stattdessen gibt es „das Risiko von unfairem Wettbewerb und Unterschieden im EU-Kunstmarkt“, insbesondere für Kunstmessen, für die die Mehrwertsteuer „einen großen Unterschied macht“, sagte sie. „Wir beobachten es genau, aber es gibt nichts, was tatsächlich auf internationaler Ebene getan werden kann.“
Bochereau verwies auf die Niederlande, wo die Regierung ihren reduzierten Mehrwertsteuersatz von 9 Prozent für kulturelle Güter, einschließlich importierter Kunstobjekte, Kunstwerke, die vom Schöpfer verkauft werden, und andere, abgeschafft hat. Stattdessen werden diese Artikel ab dem nächsten Jahr einem Mehrwertsteuersatz von 21 Prozent unterliegen. In Italien gab es Hoffnungen, dass die Regierung die Forderungen des Kunstsektors nach einer Senkung der Mehrwertsteuer auf Sekundärkunstverkäufe von 22 Prozent auf zwischen 5 und 10 Prozent genehmigen würde, aber die Einheimischen halten nicht den Atem an.