The German Culture Council announces great cultural success and thanks the Minister of Culture Claudia Roth. The reintroduction of the reduced VAT for galleries and the art trade after 10 years has succeeded.
Bundeskabinett adopted annual tax law 2024
Today the Federal Cabinet ceremoniously passed the annual tax law 2024 , a significant step for the future of the tax system in Germany. However, the German Cultural Council , as the highest representative of the Federal Culture Associations, drew attention to an important concern (see Design Annual Tax Act 2024: Great disappointment for art trade )
He critically commented in May that the original draft of the Federal Ministry of Finance did not provide for the introduction of a reduced sales tax rate for galleries and the art trade . This fact met with great lack of understanding and triggered discussions about the promotion of the art world in a tax context.
Finale engagement by Claudia Roth crowned successfully
The German Culture Council then asked Minister of Culture Claudia Roth to get involved in the final routes and to use the Federal Minister of Finance to reduce VAT for galleries and the art trade. This project was successful. The German Cultural Council would like to thank Claudia Roth for their commitment and congratulates this significant cultural success.
The head of the German Cultural Council, Olaf Zimmermann , commented in a press release from the Cultural Council as follows:
The reintroduction of the reduced sales tax rate for the art trade from January 1, 2025 is a significant success in cultural policy. It was debated for a long time. After the requirements were created at EU level, implementation in Germany was due. Claudia Roth is due to the fact that it has been possible to win a majority within the federal government until the cabinet. Thank you!".
Look back
Art is a cultural asset. And in Germany the reduced VAT of 7%applies. This measure is intended to promote the cultural landscape and to facilitate access to art for all citizens. Unfortunately, in 2014, the tax reduction for the commercial sale of works of art in Germany was abolished, contrary to the long -term political principle, to support the cultural area through tax reductions.
This decision was influenced by an EU guideline from 2006, which forced Germany to implement in order to avoid a violation procedure of the European Commission. This abolition led to considerable imbalances and stresses for galleries, which are now fully taxed.
Compared to artists: inside whose works are still taxed with a reduced sentence, as well as other cultural goods and events such as books, concerts and theater performances, which are also only taxed at 7%, are now disadvantageous.
The abolition of the reduced sales tax rate for the art trade in 2013 put galleries strongly under pressure photo by Jessica Pamp @Yessijes, via unsplash
This artificial competitive disadvantage put the German galleries under pressure, especially in an international comparison. In countries such as France, Switzerland, England and New York, lower VAT sets apply to art trade, which meant that German galleries were exposed to unfair competition.
The consequences of this decision were fatal: many small and medium -sized galleries had had to close since 2014, which was not only tragic for the gallery owners concerned, but also led to a lack of young people in the German art market.
Even before the outbreak of Covid-19, the German art trade associations vehemently called for the return to the reduced VAT rate of seven percent, which was valid until the end of 2013.
The considerable financial burdens and challenges for the art trade in Germany urgently needed a solution that was now found.
Owner and Managing Director of Kunstplaza. Publicist, editor, and passionate blogger in the field of art, design, and creativity since 2011. Successful completion of a degree in web design as part of a university program (2008). Further development of creativity techniques through courses in free drawing, expressive painting, and theater/acting. Profound knowledge of the art market through many years of journalistic research and numerous collaborations with actors/institutions from art and culture.
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