asked the Minister for Finance if his attention has been drawn to the fact that the imposition of VAT on works of art coming into Ireland is causing serious concern as an effective one way value on traffic in works of art; that the imposition of VAT on imported fine art objects is a substantial inhibition to the development of Ireland as a fine arts trading centre; whether he has any proposals to investigate the effect of the present VAT system on movement of fine art objects; and if he will make a statement on the matter.
Written Answers. - VAT on Works of Art.
29.
Works of art, like all other taxable goods, are generally liable for VAT at point of entry, irrespective of whether the importer is registered or not. Non-commercial galleries and museums and other approved institutions may import works of art not intended for sale free of VAT.
Since commercial traders may reclaim VAT paid at point of entry and may export VAT-free there is in effect no tax-related inhibition to the development of a fine arts trading centre in Ireland. Private purchasers are, therefore, the only effective payers of VAT in Ireland. This business would hardly be sufficient to sustain a significant international level of activity. In so far as sales are concerned, access to the more developed and lucrative markets for works of art in centres abroad, such as London, explains the high value of works of art exported as against imports. Accordingly, I am satisfied that VAT no more impedes trade in works of arts than it does any other taxable commodity.