London Art Dealers Celebrate Postponement of European Tax Amid Concerns Over Market Impact

Trade minister Lord Simon successfully persuaded EU ministers to postpone the proposed tax on the British art market, which would have driven business to New York and plunged the market into crisis. The delay, although cautious regarding the tax's ultimate fate, brought relief to London's art dealers, with the British Art Market Federation's chairman, Anthony Browne, calling it a "not inconsiderable achievement." While a second European tax on imported works of art remains in force, the postponement provides a temporary reprieve for the £2bn-plus art market.

Key Takeaways:

• The proposed European tax on the British art market, which would have increased VAT on imported works of art from 2.5% to 5%, has been postponed for an undefined period.
• The crucial issue remains the main art tax, droit de suite, which would be levied on every resale of an artwork during artists' lives and 70 years after their death, with money distributed to their descendants.
• The UK has argued that the tax would drive business to other centers, such as New York, Geneva, and Tokyo, which do not have similar regulations.
• The British Art Market Federation's chairman, Anthony Browne, understands there is little support for a UK exemption from the tax.
• The trade is now focused on finding a way forward to overcome the difficulties with the proposal, with discussions continuing.

Statistics:

• The British art market is valued at over £2bn.
• The proposed tax would have increased VAT on imported works of art from 2.5% to 5%.
• The droit de suite tax would be levied on a regressive scale from 4% to 0.5% depending on a picture's value.

Sources:

• Dan Atkinson, "London art dealers celebrate postponement of European tax" ( citas not provided )