On June 10, the newly-elected Government will begin to plan its legislative programme for the next five years.

In 1979 this column reported the current state of play in relation to the possible legislative laundry list which the arts community might draw up for presentation to the in-coming Government for implementation. This month’s column examines the current state of play with an eye on the next five years. There are two elements in our legislative laundry list: reforms, and innovations.


Income Tax
This was abolished for artists in Ireland in 1969, and applied to artists in France and
Italy as liberal professions’ – the same category for tax purposes as doctors, architects and lawyers who pay the tax only on non-commercial profits and who do not charge VAT. UK governments appear to be reluctant to consider any reform intended to promote, maintain or advance the financial situation of professional artists within society. The last Parliament received and published the report of a lengthy commission which had enquired into the economic state of the arts in the UK. Despite the hearing of comprehensive and enthusiastic evidence and opinion from all quarters of the arts community, little hope can be raised from reading the Report. It will still need concentrated, coherent pressure from the whole community to cause any Government to begin to consider any constrictive reform, let alone of the income tax laws for artists in particular.

A pain in the arts. The zero-rating or arts exemption lobby started four years ago achieved no legislative change. There is little doubt that the 15% level (assuming no future increase) will continue to inhibit purchasers of works of the well-heeled artists whose high turnover requires them to charge VAT. But for the majority – the down-at-heel, to follow the metaphor – perhaps the most helpful change has been to increase the VAT registration level to £18,000 turnover per year, which means that most artists will continue not to charge VAT on their sales (whether studio sales or gallery sales resulting from consignment).

However, there is one enormous change that could help all artists, particularly the majority who are not VAT- registered: the zero- or lower- rating of VAT on the purchase of artists’ materials.

It is an unfair paradox that economically less successful (i.e. unregistered for VAT) artists all pay VAT on purchases of materials but have no right to pass the VAT element on to (i.e. claim back from) purchasers of their works; yet the well-heeled (i.e. VAT-registered) can do so. If zero-/lower- rating was introduced for the sales of works of all living artists and for sales of all materials for artworks, the loss to the Customs and Excise in revenue would be relatively minor compared with the vast benefit to all artists from the reduction in real terms of all their materials bills, and to a handful of artists of their sales prices.

Social Security
No change: there is still no ‘artist’ category for registration as unemployed; except, of course, that the numbers have vastly increased over the last four years. There has, however, been a significant increase in the number of art and design graduates getting wise to the right to be admitted onto the Professional and Executive Register of unemployed, thereby entitling them to Social Security payments and the right to reject a non-art related job interview. This still leaves unchanged the situation for the remainder i.e. the non-graduate yet professional artists who have no such right to be admitted on to the PER, and who are still forced to consider signing on as labourers’ and to take such jobs if offered.

No change, despite the increasing number of copyright problems and infringements raising fundamental legal difficulties relating to the definition of ‘artistic works’. The 1956 Act still only clearly offers protection to ‘artistic works’ if made in the traditional media (named as paintings, sculpture, prints, photographs). The difficulties which therefore arise stem from trying to fit neatly into these antediluvian categories the works made by artists using a myriad of combinations of techniques not provided for in this old legislation. There have been no Government moves during the past four years which indicate even the remotest consideration of this urgent need for reform. Perhaps no one is lobbying.

Arts Charities
No change. Hundreds of arts and artists’ organisations which exist or need to exist to provide administrative support for the arts community and which can genuinely be described in reality as charitable (i.e. non-profit distributing) still have no right to registered charitable status. What is still wrong is that registration as a charity will only be allowed if the objects of the group fall strictly within the four-hundred year-old definition of being for the public benefit i.e. for education, religion, poor people or for the benefit of the public as a whole. If the organisation provides ‘support for the arts for the public benefit’ (few would argue that arts organisations do not) then registration would be facilitated and the consequential benefits would be enormous: no corporation tax on ‘profits’; 50% rates relief as of right on the organisation’s property; a further 50% rates relief as a local authority discretion; and a right to receive back from the Revenue the income tax already paid by donors of money by way of covenant. Such a change would cause minimal loss of tax revenue and would transform the economic situation of the arts community to enormous advantage – and without any need to feed such further public money through the Arts Council of Great Britain to benefit the chosen; the change would benefit everyone. But where is the arts lobby for this?


% for Art
Real progress on the lobbying front during the past two years: starting with the Art and Architecture conference at the ICA and back-up seminars prompting the creation of the Art and Architecture organisation, a greater public and professional awareness of the need to promote a higher degree of professional interface between artists and architects is being achieved. The % for Art legislation lobby is growing and perhaps the time is ripe to consider pressing for national % for Art legislation. Furthermore, the current political complexion of the GLC has already allowed it to indicate its sympathy for and positive interest in the implementation of its own % for Art programme i.e. by requiring GLC financed building works to provide, as a % of the overall cost, money for an ‘art’ element in the project. (Rock on, Kenny!).

Public Exhibition Payments
Despite serious reservations and criticisms from many quarters, this valuable economic right is seeing the light of day without legislation. From Mark Boyle’s initial suggestion to the Arts Council of Great Britain five or six years ago, through the implementation of their own modest scheme three or four years ago, the Regional Arts Associations have now begun to take the idea on board and in many regions have implemented their own programmes.

Artists can therefore now receive a payment (the sum, though tiny in many cases, is not the most important issue yet) whenever their works are exhibited in ACGB- or RAA- funded shows/galleries where a scheme applies. Great progress: the level of payment is a matter for future debate and pressure, the most urgent need now being to consolidate current progress and to extend the application of the schemes more widely. Should such similar progress be made during the next five years, perhaps the need for national legislation would disappear.

Tax Incentives
No real change. Unlike our European and American friends, the United Kingdom government provides few real tax incentives to encourage purchasers, donors and sponsors of artists/artworks/arts activities, be they private or corporate patrons. Arts sponsorship from commerce and industry has indeed grown enormously over the past four years (full marks to ABSA for piloting the ship if not leading the field), but our current tax systems only allow companies or self-employed sponsors to use their arts sponsorship monies to reduce their profits before taxation. It would be of much greater advantage if they were allowed to pay monies in arts sponsorship instead of paying tax. This happens in a number of foreign countries, but there is yet no lobby for this here.

Droit de Suite
No change. The EEC threatens to press the UK government to introduce this re-sale royalty law for artists. (Perhaps, by way of analogy, the implementation of the literary Public Lending Right this year bodes well for the future, but then arguing by analogy is always dangerous.)

Droit Moral
No change – except that the need for such legislation ever increases with the growth of artist’s work being subjected to abuses. This uneconomic artist’s right, increasingly enacted in other countries throughout the world (over sixty, to date) and giving protection to artists and their works against abuses, always seems to come last on my list. This paradox is ironic, because the need is not for money, but for what artists most care about: their work and their reputations. The introduction of legislation giving artists the moral right to protect themselves and their works would cost the Government nothing; but artists need to articulate their professional concerns and needs very loudly and very clearly if change is to occur.

So, there we are again; same old bag of beans. Let us hope for, and work together towards creating, a better report next time round.

© Henry Lydiate 1983

This article is from the Artlaw Archive of Henry Lydiate's columns published in Art Monthly since 1976, and may contain out of date material. The article is for information only, and not for the purpose of providing legal advice. Readers should consult a solicitor for legal advice on specific matters. Artists can get free online legal information from Artquest.