Skip to main content

Consensus reached on expansion of sales tax exemption for art sales

  • Date:2019-11-29
Consensus reached on expansion of sales tax exemption for art sales

To promote the creation of art and boost the trading market, the Ministry of Culture and the Ministry of Finance have reached a consensus to expand the mechanisms of exemption from business tax under the provisions of the Culture and Arts Reward Act (文化藝術獎助條例) to sales at art exhibitions.

Henceforth, orders or letters of intent between buyers at exhibitions and gallery operators running their own spaces or participating in exhibitions will be exempted from business tax upon completion of the relevant transaction. In addition, galleries can submit annual exhibition plans or apply for several exhibitions over the course of the year as one-off applications and have these also included in the scope of said exemption.

Some exhibition activities, such as art fairs, usually run for just three or four days, and so in the future, as long as the buyer has expressed during that time their willingness to complete a transaction and that the gallery provides relevant supporting documents (such as a purchase order, letter of intent, or deposit remittance), after the transaction is completed the gallery operator can declare an exemption from business tax.

Value-added business tax in Taiwan is a consumer tax, and so to encourage the consumption of art, the Ministry of Culture and the Ministry of Finance have drafted the Regulations for Reducing Business and Entertainment Taxes for Cultural and Arts-related Enterprises (文化藝術事業減免營業稅及娛樂稅辦法) in accordance with the Culture and Arts Reward Act.

Registered art and culture businesses in Taiwan conducting exhibitions, performances, screenings, or auctions must submit applications no later than one month ahead of the scheduled event(s), with the Ministry of Culture, Ministry of Finance, and relevant business authorities jointly holding monthly meetings of the Reducing Business and Entertainment Taxes for Cultural and Arts-related Enterprises Monitoring Team (文化藝術事業減免營業稅及娛樂稅審查小組) to review applications.

Those that pass review will receive official documents from the Ministry of Culture that can be used to declare tax exemptions at the relevant local taxation office.

Applications are available here.