{"id":208981,"date":"2025-06-24T00:16:11","date_gmt":"2025-06-24T00:16:11","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/208981\/"},"modified":"2025-06-24T00:16:11","modified_gmt":"2025-06-24T00:16:11","slug":"italy-finally-bows-to-local-pressure-and-slashes-art-vat-to-5-percent","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/208981\/","title":{"rendered":"Italy Finally Bows to Local Pressure and Slashes Art VAT to 5 Percent"},"content":{"rendered":"

\n\tIt\u2019s hard to make tax sexy, but Italy<\/a> is doing its best.<\/p>\n

\n\tOn Monday, the Italian government announced will cut the country\u2019s VAT on art sales from 22 percent\u2014the highest in the European Union\u2014to just 5 percent. The slashed rate, set to go into effect later this week, will now be the lowest in the EU. Germany and France are the closest, with 7 percent and 5.5 percent VATs on art sales, respectively.<\/p>\n

The move was approved in a cabinet meeting on Friday, per the Financial Times, and comes after a pressure campaign from Italian galleries, artists, auction houses, and art market players. Italy\u2019s culture minister, Alessandro Giuli, said in a statement that the tax break should bring relief to \u201cthe entire art ecosystem, one of the most vital bastions of our cultural identity.\u201d<\/p>\n

While the new legislation will come into force within days, it needs to be approved by the parliament within 60 days to remain in permanent effect.<\/p>\n

A study published earlier this year by consulting and market intelligence company Nomisma estimated that cutting the VAT<\/a> could see galleries, antique dealers, and auction houses in Italy generate \u20ac1.5 billion in three years. It also predicted that the Italian economy could swell by up to \u20ac4.2 billion as a result. On the flipside, Nomisma warned that if the VAT remained at 22 percent, the country\u2019s art market risked shrinking by almost 30 percent.<\/p>\n

\t\tRelated Articles<\/p>\n

\t\t\t\t\t\t\"Two<\/p>\n

\n\tThe lower VAT on art transactions arrives on the back of a new EU rule called Directive 2022\/542<\/a> that aims to standardize member states\u2019 notoriously complex VAT system. It allows members to reduce taxes on art sales provided the rate remains at 5 percent or over. However, to do so, they must scrap their previous, more tedious taxing system.<\/p>\n

\n\tIn February, Italy government, led by right-wing prime minister Giorgia Meloni, said that it would not budge on its 22 percent rate, saying that it was concerned it would be bowing to pressure from well-heeled collectors, rather than helping rescue the industry. But the U-turn comes after mounting pressure from the culture sector.<\/p>\n

At Milan\u2019s Miart fair in April, several dealers circulated an open letter addressed to Meloni; it was signed by 600 artists and said the high VAT threatened to turn Italy into a \u201ccultural desert.\u201d Also, last year, the Apollo Group, an association of Italian antiquarians, art galleries, collectors, art logistics companies, and auction houses,\u00a0issued a statement\u00a0calling on the Italian government\u00a0to lower VAT for the sale of art.<\/p>\n

\n\t\u201c[If the tax is not reduced] any collector who wanted to import or buy work in the European Union would certainly not do so in Italy,\u201d read a paper published by Apollo.<\/p>\n

The policy change seems to have caught many Italian dealers by surprise. Last week, at Art Basel in Switzerland, several such dealers merely shrugged their shoulders when asked if they thought change might be coming to the VAT. Maurizio Rigillo, cofounder of Galleria Continua, which has a space in Rome, told ARTnews last Wednesday. \u201cWe hope the VAT will come down, it would be fantastic. It\u2019s a massive disadvantage for us. At the moment, Italian collectors are buying elsewhere in Europe.\u201d<\/p>\n

Despite Italy\u2019s status as a historical cultural powerhouse, its art market has lagged behind its European neighbors. Clare McAndrew, the founder of Art Economics, told ARTnews that according to her \u201cconservative\u201d estimates, art sales in Italy hit somewhere between $381 million and $425 million last year. By comparison, the 2025 edition of the Art Basel UBS Art Market Report found that art sales in the UK totalled $10.4 billion in 2024, while France realized $4.2 billion.<\/p>\n

\n\t\u201c[Italy\u2019s high VAT] arguably undermines the Italian art market relative to countries like Germany and France, where VAT rates have been strategically lowered by virtue of the EU Directive,\u201d the report reads.<\/p>\n

High sales tax is one thing holding Italian galleries back, but strict legislation regulating the trade of cultural goods is another. Releasing the VAT handbrake should help to mitigate the 10 percent decline that Italy\u2019s art market suffered in 2024 (as per the Art Basel UBS report).<\/p>\n

Andrea Festa, the founder of an eponymous contemporary art \u00a0gallery overlooking Rome\u2019s Castel Sant\u2019Angelo across the River Tiber, told ARTnews that Italy\u2019s high VAT on art sales put Italian galleries at a \u201ccompetitive disadvantage.\u201d<\/p>\n

\n\t\u201cWe operate in a globalized art world where it\u2019s increasingly common\u2014and necessary\u2014for artists to collaborate with multiple galleries across different countries. This made the disparities in national VAT rates impossible to ignore,\u201d he said. \u201cMoreover, until very recently, Italy had one of the highest import tax burdens on artworks in Europe. That rate has now been reduced to 10 percent, which is certainly a welcome shift, even if it still leaves us behind many of our European peers. In a moment when the art market has contracted, this kind of fiscal reform is not just helpful, but vital.\u201d<\/p>\n

Gallerist Davide Mazzoleni, whose eponymous gallery has spaces in London and Turin, plus a soon-to-open gallery in Milan, said a tax reduction is a \u201cgame-changer for Italian dealers.\u201d<\/p>\n

\n\t\u201cLowering VAT to 5 percent will significantly increase market turnover and generate a substantial overall economic impact,\u201d he added. \u201cVAT reform was therefore not merely desirable, but essential for the long-term sustainability and international competitiveness of\u00a0Italy\u2019s art system.\u201d<\/p>\n

Catarina Antonaci, the associate director of Richard Saltoun Gallery in Rome, told ARTnews that \u201cshe is pleased she can now offer collectors more favorable conditions\u2014it\u2019s undoubtedly a strong incentive for our market.\u201d ( Saltoun also has spaces in London and New York.)<\/p>\n

Luigi Fassi, director of Turin\u2019s Artissima art fair, said the Italian government finally understands \u201cthe need for a drastic reduction in VAT to help maintain the completeness of Italian galleries.\u201d<\/p>\n

Just days before the lower VAT was announced, he told ARTnews: \u201cThe response from collectors will be significant, as anticipation is running high. In this regard, the Italian art system is showing strong unity. There is a shared desire to play an active role and to keep the extraordinary tradition of Italian collecting alive.\u201d<\/p>\n

\n\tItalian auction houses are also expected to reap the benefits of the reduced VAT. Agnese Bonanno, the head of marketing and communications at Il Ponte Auction House in Milan, told ARTnews in an email that \u201charmonizing VAT rates with European standards substantially enhances the structural competitiveness of the Italian art market, attracting both international collectors and market operators to invest in the country, while simultaneously promoting greater circulation of works of art.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"It\u2019s hard to make tax sexy, but Italy is doing its best. On Monday, the Italian government announced…\n","protected":false},"author":2,"featured_media":208982,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3939],"tags":[4021,4020,4022,77,2199,16,15],"class_list":{"0":"post-208981","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-arts-and-design","8":"tag-arts","9":"tag-arts-and-design","10":"tag-design","11":"tag-entertainment","12":"tag-italy","13":"tag-uk","14":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114735467306159326","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/208981","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=208981"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/208981\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/208982"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=208981"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=208981"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=208981"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}