Artist’s Resale Right Regulations

My Lords, I shall be brief and, in contrast to other speakers, support the Government. The information that surprised and shocked me most was that 40 per cent of British artists earn less than £5,000 per annum. If we want flourishing art in our country, where we have, and encourage, creativity, we must look at the well-being of young artists. If this measure helps young artists, it is surely justified. After all, most artists have to sell their works of art cheaply at the start of their careers, before they have made any reputation for themselves. This measure is intended directly to help those artists start their careers and get a little bit more for the work that they have created. I appreciate the issue of the threshold, about which the noble Lord, Lord Brooke of Sutton Mandeville, argued very strongly. On the other hand, some EU countries have set a much lower threshold. It is right that the Government seek to achieve a balance between the threshold and keeping bureaucracy to a minimum. It has been said that this will damage the British art market altogether. I am not convinced of that argument. If someone were to send a picture abroad to be sold—say, in New York—and then it were to be returned, there would be transport, handling and insurance costs, the gamble on the strength of the pound against the dollar, comparable rates of sales premiums—or they might not be comparable—and import VAT. Import VAT is surely a significant factor in the equation: a tax on imports into the EU from non-EU countries, which is now 5 per cent across the EU. There is no import VAT for movements within the EU. It would therefore cost an EU buyer significantly more in import VAT to buy in New York than it would cost to pay resale royalties in London. If the buyer is a European national, they would be required to pay the 5 per cent import VAT on the value of the painting, or other work of art, to return it to the EU. If the painting is valued at £1.4 million, for example, import VAT would be £70,000, compared with the maximum royalty payable of £8,500. The argument that works of art will be diverted from this country simply does not stand up in the face of those figures. Of course, there is a sliding scale. At a threshold of €1,000, an estimated 50 per cent of eligible artists will benefit. I do not always agree with the Government, but I believe that they have got it right in this instance. They are bringing forward the measure in such a way that it will help many British artists.