Big & Small

Christine steiner explores the Changes in the art world and the implications for dealers, Collextors and galleries.

Art is an increasingly global industry. As of 2015, acknowledged market reports estimated the art market was a $63.8 billion dollar global business. New and veteran collectors are setting record prices for contemporary art at auctions and establishing themselves as market players with connections to high-profile galleries, museums and foundations. The increasing globalisation of art mirrors the global expansion of private wealth. Newly wealthy individuals from Asia, Russia, Latin America and the Middle East are interested in collecting top contemporary art and exerting influence in the art world, as demonstrated by the recent growth in private museums. Collectors from nations with established wealth continue to purchase internationally and actively participate in the art world. Globalisation of private wealth means that planning from a multi-jurisdictional perspective is essential for the globally-inclined private collector, artist, art gallery or museum.

THE THREE A’S

The benefits of cross-border tax and wealth planning are clearly evident for high-net worth private collectors having potential exposure to multiple taxing regimes and wishing to preserving their wealth for future generations. Similar considerations apply for art galleries with international outposts that must contend with tax issues that arise from doing business and deriving income internationally, for artists who create internationally and maintain studios in multiple locations, as well as for museums planning survival and expansion by cultivating international donors. Sophisticated players in the art world are careful to assemble a knowledgeable team, the “Three A’s” of art – an art appraiser, an art attorney and an accountant. The movement of players in global locations will also continue to necessitate sophisticated tax advice and legal advice in disciplines other than tax, these include areas such as immigration, crossborder commercial and contract law, import-export law, employment law and other legal fields as well.

TAXES