Spain to Slash Sales Tax on Art

 

Bowing to intense pressure, the Spanish government on Friday announced it was going to lower the value-added tax (VAT) rate charged on transactions involving works of art to 10% from 21%.

Speaking at a press conference following the weekly Cabinet meeting, Deputy PM Soraya Sáenz de Santamaría said the move was to bring Spain in line with other countries in Europe, such as Italy and Germany, where the VAT rate on works of art is 10% and 7%, respectively.

The government controversially increased the VAT rate on all cultural items in 2012, from 8% to 21%. Asked if the VAT rate on other cultural items would also be cut, Sáenz de Santamaría said the reduction for works of art was a "first step." "We have to introduce measures to promote Spanish culture and we have brought forward one of them," she said. Culture Ministry sources said the government was also "studying new measures" for the film industry.

"This is great news for all of us; the best we could receive," Madrid gallery owner Oliva Arauna told EL PAÍS.