The VAT for trading in artworks will be reduced from 19% to 7%. This step is part of the 2024 Annual Tax Act and aims to strengthen the competitiveness of German galleries and art dealers.
The reduction in VAT means significant financial relief for galleries and art dealers. This strengthens their position and competitiveness not only within Germany but also internationally. Galleries will be better able to support their artists and present their work to a broader audience.
Minister of State for Culture Claudia Roth and Federal Finance Minister Christian Lindner were praised for their efforts to implement this important tax adjustment. It underscores the federal government's commitment to promoting Germany as a hub for the art market and strengthening cultural diversity (GermanArt.org).
Since 2013, galleries and art dealers in Germany have had to apply the full VAT rate of 19% to their sales, which put them at a disadvantage compared to other European countries. For example, France has already decided to introduce a reduced rate of 5.5% for the art trade starting in 2025.
The German Cultural Council and the Federal Association of German Galleries and Art Dealers (BVDG) have long fought for this change. The change was made possible by an EU directive that allows member states to apply reduced VAT rates for certain goods, including artworks (Cultural Council) (Federal Government).
With the smart bulk processing function in ARTBUTLER PRO, you can change the prices of multiple works with a single click for your entire inventory. You can adjust all values (net price, VAT rate, gross price, currency, and price comment) or specific values such as only the VAT rate or the currency. Here is an example: select all works with the old tax rate of 19% and change this to 7% through bulk processing. Done!
The adjustment of VAT is an important step to improve the framework conditions for the art market and strengthen the cultural infrastructure. It remains to be seen how this change will affect the art trade and the cultural scene in Germany in the long term.
Learn more about the smart art management software ARTBUTLER PRO.