From FdI bill to lower VAT on art

Of an opposite opinion, in 2022, was the Regional Commission: the tax appeal had, instead, framed the former manager's activity in the artistic field as 'non-habitual business' and, in particular, as 'occasional speculation' and, therefore, generating different and therefore taxable income. The daughter, and heir of the Rovereto collector, appealed the decision to the Court of Cassation, which, however, rejected the appeal. The defence's argument, which insisted over the years on Osvaldo Bastoni's status as a collector and not an art dealer, was of no avail. This is a fundamental distinction given that, in the first case, he is a pure collector and therefore non-profit making.

But it is precisely the valorisation through exhibition that is the discriminating factor: 'Bastoni,' the ermines recall, 'had admitted that, in 2013, in addition to having sold the work of art by Monet, he had also purchased three works of art, still in his possession, from Sotheby's and had exchanged four paintings by Segantini for one by Gauguin. He also noted that in the preceding and subsequent years, Bastoni had also bought and sold numerous other works, again through auction houses of worldwide prestige, naturally carrying out commercial activities'.

The judges, of course, refer to the ruling of the regional tax commission, which reiterated that 'Bastoni could not be considered a dealer in works of art, but noted that many works he owned had been exhibited at the Mart and in American museums, which would have led to an increase in the value of these works, which were then resold after they had reached prices above the purchase price'. 'From these circumstances,' the Court of Cassation then reiterated, 'the tax commission drew the conviction that, although the collector did not habitually engage in entrepreneurial-commercial activity, he had, however, concluded purchases, sales and other transactions intended to increase the overall value of the works that were the subject of the sale and, therefore, not only to contemplate their beauty or satisfy his own aesthetic taste or for a cultural purpose. He therefore considered that this activity was to be regarded as a non-habitual commercial activity and, in particular, as 'occasional speculation' and, as such, liable to generate 'miscellaneous income' liable to tax'.

On the other hand, the act even of public benefit of a private collector lending one of his works to an exhibition for the enjoyment of the community and for scientific reasons is not grasped at all.

The commission therefore considered that Bastoni, although a collector, had not dedicated himself to the mere accumulation of works (evidently the only purpose according to the judges of collecting) but had carried out activities aimed at their valorisation and exchange, when this appeared economically convenient. Evidently for the Tax Commission, works of art in private hands must not have public use, otherwise the venal sin of valorisation is committed! It is a pity that the law on constraints (Legislative Decree 42/2004), which obliges the private individual to a series of limitations (Art. 14) on works of cultural interest (Art. 13) does not even oblige the State to take on the burden of displaying them, in short, it does not provide for public enjoyment even in the presence of a collective cultural interest. In short, masterpieces according to tax experts, the Court of Cassation and legislators should remain in secret private rooms. And perhaps be forgotten!

In addition to the damage, there is also the mockery for the heir. In addition to having to pay taxes, Ilaria Bastoni must also meet the court costs incurred by the Inland Revenue amounting to EUR 12,000. It is now hoped that the current bill to regulate the art trade will also provide more certainty on the taxation of art capital gains. This has recently been demanded in a position paper Assonime, by accountants, notaries, Confindustria, museums in the voice of Amaci and, of course, all art dealers gathered in the Apollo Group. The launch of the tax reform cannot wait any longer.