- The Law of Finance 2024 introduces important reforms for art galleries, art agents, and antique dealers regarding the VAT rate and margin VAT mechanism for art sales.
- Previously, these actors could purchase art at a reduced VAT rate of 5.5% and resell it with a VAT rate of 20% on the margin.
- The directive 2022/542 made the margin VAT mechanism inapplicable when a reduced VAT rate was applied during the purchase.
- The government had two options to comply with the directive: apply a 5.5% VAT rate to both purchase and resale without the margin VAT mechanism, or remove the reduced VAT rate and maintain the margin VAT mechanism.
- The government seems to have chosen the first option in the draft Law of Finance for 2024.
- The amendment in the draft law extends the 5.5% VAT rate to both purchase and resale of artworks, as long as the margin VAT mechanism is not applied.
- The draft Law of Finance for 2024 also removes the margin VAT mechanism for deliveries made by art galleries, agents, and antique dealers.
- These reforms aim to comply with the directive 2022/542 while keeping the French art sector competitive.
Source: mathez-formation.fr
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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