Catherine Murphy (Kildare North, Independent)
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Question 53: To ask the Minister for Finance the revenue, if any, that is collected on works of art, many of which appear to be selling for record prices; his plans for revenue raising measures on such assets at the point of transaction; and if he will make a statement on the matter. [18530/11]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that the information furnished on tax returns does not generally require the yield from a particular sector or sub-sector of economic activity to be identified. In these circumstances the amount of tax revenues relating to works of art cannot be separately identified. There is, therefore, no statistical basis on which the information requested by the Deputy could be estimated. With regard to the VAT treatment of the supply of works of art, I am further advised by the Revenue Commissioners that different treatments for VAT purposes may apply. Works of art such as paintings, drawings, engravings and sculptures are normally liable at the 13.5% reduced rate. Other works such as tapestries, ceramics, enamels and some photographs are normally liable at the standard rate of 21%. However, the reduced rate may apply in certain circumstances (principally to imports from outside the EU and the supply by the original artist). This is part of the rates strategy in the EU VAT Directive designed to encourage the flow of works of art into the EU.

Where a work of art is sold under the margin scheme for taxable dealers or special auction scheme, the sale is liable at the standard VAT rate on the margin. The operation of these schemes is explained in Revenue's VAT Information Leaflets entitled "Margin Scheme – Second-Hand Goods" and "Auctioneering".

In relation to the capital gains tax treatment of works of art, works of art are assets for capital gains tax purposes and are thus within the charge to that tax if the person disposing of those assets is Irish-resident. There is, however, an exemption from capital gains tax for a disposal of a work of art that has been loaned to an approved gallery for a period of not less than 10 years and has been on display to the public in that gallery. In order to qualify for this exemption, a work of art must have a face value of at least €31,750 at the time it was loaned to the gallery. If the person disposing of works of art is trading in such goods, any profit on sale will be liable to income tax instead of capital gains tax.

I have no plans to change these taxation arrangements.