Picking battles

Art auctions: London’s auctioneers are starting to sound a lot like its bankers. They are warning of a dire threat to London’s standing at the centre of the world’s art trade if the government doesn't block the implementation of a European resale levy on works of art, known as droit de suite.

The UK already toes the Brussels line when a living artist is involved. But it secured an exemption until 2012 from a requirement to pay the levy to the artist’s estate if he or she died within the last 70 years. Art dealers want the government to negotiate another exemption.

 

When bankers warned politicians that taxing big bonuses would drive business abroad, they were largely ignored. Those dealing in fine art probably have a better case for special treatment.

First off, their concern looks more justified. Sure, a handful of bankers and hedgies have succumbed to the charms of Geneva since the UK upped taxes on high earners. But for most financiers, taking the kids out of school and leaving London clients to rivals is easier said than done. Works of art, on the other hand, are eminently mobile. For a German art dealer planning to auction a collection of paintings in London, it doesn’t cost much more to sell in New York or Hong Kong.

Also, this is an industry worth nurturing. Sure, these posh dealers might not seem like the sort of people who deserve help, especially when welfare benefits are being cut.

But the art business helps the balance of trade as well as offering a certain cachet. A little support would show the government is serious about weaning the UK off its dependence on money men. Britain has made some costly cultural gaffes in its time — such as the £700 million it spent on an empty dome in London’s docklands. But the risks of helping Britain’s art market gain a competitive edge are limited. After all, no dealer in Picasso – however much he may have overpaid for one of the master’s works – has ever required a taxpayer bailout.