Italian lawmakers have approved a reduction of VAT on art sales from 22% to 5%, the lowest rate in the European Union. The decision, announced by culture minister Alessandro Giuli after a cabinet meeting on June 20, is expected to take effect this week. The reform follows intense lobbying by art market groups and a letter signed by 500 art world figures, including artists Maurizio Cattelan and Michelangelo Pistoletto, who warned the high rate was turning Italy into a "cultural desert." The tax cut must be passed by parliament within 60 days to remain in force, and may also apply to import VAT, potentially making Italy the most competitive art market in Europe from a tax standpoint.
This move matters because it reverses Italy's previous position as the country with the highest art VAT in Europe, aligning it with lower rates in France (5.5%) and Germany (7%). The reform is expected to boost the annual turnover of Italian galleries, antique dealers, and auction houses to €1.5 billion within three years, generating an extra €4.2 billion for the economy. It also signals broader reforms, including simplification of export licenses for cultural objects and digital infrastructure improvements, positioning Italy as a major international hub for art trade and fairs.