Issue #264  1/9/2024
France Maintains and Extends Reduced VAT on Works of Art

By Alex Novak

With its adoption of the Draft Finance Law for 2024, France chose to maintain the reduced rate of 5.5% VAT applicable to works of art and to extend it to all transactions.

France's approach to the European directive of April 5, 2022 provides that all sales of works of art and photography will be taxed at the VAT rate of 5.5% on the total sales price from January 1, 2025 onwards.

Currently, the importation and sale of works of art by artists are taxed at the competitive rate of 5.5% VAT. The extension of this reduced rate to all transactions on works of art allows the French market to remain competitive and attractive for artists and buyers, as well as allowing the country to keep its visual arts sector viable in the global market.

The application of a reduced VAT rate of 5.5% to the entire chain of transactions on works of art is combined with the abandonment of the complex VAT regime on the commercial margin. This harmonization allows for clarification of the system applicable to all players in the ecosystem.

Le Comité Professionnel des Galeries d'Art (CPGA), which has worked particularly hard to raise awareness among public authorities of the economic impacts of the original European directive and was joined in this action by other professional art organizations and by particularly attentive artists, noted that it was relieved by the action and welcomed the adoption of this major measure for the sector.

Marion Papillon, president of the CPGA, proclaimed, "The support and political commitment of the government and parliamentarians demonstrate the economic scope of the art market, as well as the challenge of French cultural exception.

"This measure will support artistic creation and heritage and consolidate the position of France as leader in the European art market."

This also is expected to be a relief for art fairs, such as Paris Photo, which are highly dependent on international exhibitors who would not have otherwise been able to afford the already high cost of exhibiting if the proposed 20% VAT was applied to their sales.

Novak has over 48 years experience in the photography-collecting arena. He is a long-time member and formally board member of the Daguerreian Society, and, when it was still functioning, he was a member of the American Photographic Historical Society (APHS). He organized the 2016 19th-century Photography Show and Conference for the Daguerreian Society. He is also a long-time member of the Association of International Photography Art Dealers, or AIPAD. Novak has been a member of the board of the nonprofit Photo Review, which publishes both the Photo Review and the Photograph Collector, and is currently on the Photo Review's advisory board. He was a founding member of the Getty Museum Photography Council. He is author of French 19th-Century Master Photographers: Life into Art.

Novak has had photography articles and columns published in several newspapers, the American Photographic Historical Society newsletter, the Photograph Collector and the Daguerreian Society newsletter. He writes and publishes the E-Photo Newsletter, the largest circulation newsletter in the field. Novak is also president and owner of Contemporary Works/Vintage Works, a private photography dealer, which sells by appointment and has sold at exhibit shows, such as AIPAD New York and Miami, Art Chicago, Classic Photography LA, Photo LA, Paris Photo, The 19th-century Photography Show, Art Miami, etc.