Thursday, 23 December 2010
But is it art?
An interesting decision by the European Commission on the thorny issue of VAT prompted another post Meltwater muse, but this time on art – and whether we might be expecting an ‘Infopaq’ decision on what constitutes an “artistic work” - it might be marvellous darling – but ‘is it art?’
The case involves a light installation at the Hayward Gallery by Dan Flavin and the decision revolves around whether VAT on Flavin’s work was payable at 5% as an artistic sculpture or at full rate (17.5%) as a light fitting. HM Revenue & Customs unsurprisingly asked for VAT at full rate (£36,000) but the VAT & Duties Tribunal rejected the HMRC claim. I can’t find any details of the case on BAILII on the First Tier Tribunal (Tax) pages, but it seems that HMRC were not convinced and asked Brussels for a ruling on the question of whether or not the installation was “art”. The European Commission ruled that the work should be classified for tax purposes as simple light fixtures. Flavin’s work, they said, has "the characteristics of lighting fittings … and is therefore to be classified … as wall lighting fittings" saying “It is not the installation that constitutes a 'work of art' but the result of the operations (the light effect) carried out by it." Although why anyone would pay thousands of pounds for a light fitting doesn’t seemed to have been answered, it also affects the work of Bill Viola, another American whose work is video pieces, filmed in extreme slow motion...
Art Newspaper reports that Pierre Valentin, the lawyer who challenged the original HMRC ruling saying “To suggest, for example, that a work by Dan Flavin is a work of art only when it is switched on, is comical" adding "One is entitled to ask if the Commission has made a judicious use of its powers when overruling these judicial decisions. The reasons given in the regulation in support of the classification are absurd, and the regulation conflicts with the jurisprudence of the European Court of Justice." Is there one rule for tax – and one for copyright?
But what is and isn’t art has long been debated. In 2007 a London art storage company was ordered to pay compensation to a Swiss collector after an Anish Kapoor sculpture ended up in a skip. In 2004 the Tate Gallery was embarrassed when a cleaner innocently threw out an overflowing rubbish bag. It was part of an installation by Gustav Metzger, aptly entitled Recreation of First Public Demonstration of Auto-Destructive Art. Pickled cows, sheep and sharks in a glass case? Step forward Damien Hirst. A Pile of bricks? Equivalent VIII by Carl Andre was bought by Tate in 1972 and featured in special displays in 1974 and 1975. Tracy Emin’s unmade Bed (1999)? Bags of rubbish? Art? Really?
In the UK, Artistic Works must be ‘original’ and a measure of skill, judgment and labour must be present. Section 4 of the Copyright Designs and Patents Act 1988 provide that these works are (1) (irrespective of artistic quality) a graphic work, photograph sculpture, collage; (2) works of architecture and (3) works of artistic craftsmanship not within category (1) or category (2). Cornish details that a simple drawing of a human hand showing where a vote should be cast, the label design for a sweet tin and drawings for patchwork bedspreads have all been accorded copyright protection (Kenrick v Lawrence  25 QBD 99, Tavener Rutledge v Specters  RPC 355 CA, Vermaat v Boncrest  FSR 44). In Wham-O v Lincoln even a Frisbee was held to be an engraving because of the concentric rings on the plastic body 91985)although the court in Metix v Maughan  FSR 718 found that a sculpture was “a three-dimensional work made by an artist’s hand’.
But what of tax law and art .... of course some of these debates end up in Court and in 1926 a row erupted in the USA over the work of the Romanian sculptor Constantin Brancusi. The American collector Edward Steichen had bought a bronze version of his tall slender Bird In Space, and attempted to import it to the US. Since it had neither head, feet nor feathers, US customs refused to accept it as a zero-rated work of art, and instead classified it as "a manufacture of metal ... held dutiable at 40%". Steichen paid the $600 duty, but he and the sculptor then went to court – with his legal fees paid by the millionaire collector Peggy Guggenheim. Steichen succeeded in having the decision overturned and in 1928 the court ruled that "while some difficulty might be encountered in associating it with a bird, it is nevertheless pleasing to look at and highly ornamental". So free of tax.
I look forward to seeing where Mr Flavin gets with his claim - and comments most welcome.
Photo A presumed Banksy of Michael 'Jay-Z' Eavis on a wall in Glastonbury Town. By Ben Challis (c) 2010.