GST cut set to brighten India’s art landscape

Auction houses, galleries say the rate cut from 12% to 5% will boost liquidity, attract younger collectors, fuel growth

- VEENU SANDHU

With the revised slabs of the goods and services tax (GST) taking effect on September 22, India’s art world was among those who welcomed the rate cut.

GST on art and cultural goods has been reduced from 12 per cent to 5 per cent, a move that could spark a new phase of growth in collecting, broaden the buyer base, and further boost momentum in an already buoyant market, says the industry.

“All art, irrespective of the materials used in its making, is now levied a 5 per cent GST,” says Ashish Anand, chief executive officer and managing director, DAG (formerly Delhi Art Gallery), describing the GST cut as a game-changer. “Art can never occur in a vacuum, and requires patrons. High taxes have kept away collectors who will now embrace the new GST,” he says. With interest in Indian art already surging, he is confident that “we are entering a golden era of collecting and patronage”.

When artworks by modern masters or contemporary artists change hands for tens of crores, GST is generally levied over and above the hammer price, says Manoj Mansukhani, director of marketing at AstaGuru Auction House. For buyers, that meant the cost of acquiring works was significantly higher. With the new rate, that burden has eased. “This is expected to boost liquidity, bring more works into circulation, and encourage broader participation from collectors,” Mansukhani says.