What Is Art, and Who Gets to Decide?
January 3, 2008
The U.S. has seen many debates over what constitutes art, especially with regard to taxpayer-funded projects. This issue has come up in other countries, as well. Any government that treats art differently from other goods or professions with regard to taxing and spending policies will face the unanswerable question, What is art?
Thespian Turmoil – Film Acting is Not Art According to HMRC
At issue was where to tax acting services performed in New Zealand by a UK actor and supplied to a New Zealand production company.
The actor contended that the acting services she supplied should be taxed where performed as cultural, artistic or entertainment activities under Art 9(2)(c) EC Sixth VAT Directive (now Art 52(a) Directive 2006/112/EC). …
The position of HMRC was that the services in question were not cultural, artistic or entertainment activities because they were supplied in connection with a film. Their contention was that the services had to be interpreted in the context in which they were delivered.
Acting services supplied for a film are fundamentally different from acting services supplied for a theatre production. Since an actor providing services for a film is not performing to an audience, unlike a theatre performance, it is not a cultural, artistic or entertainment activity.
The filming of an actor’s role is, instead, part of a process that may lead to a cultural, artistic or entertainment experience in the form of a finished film. As a result, the acting service should fall under Art 9(1) EC Sixth VAT Directive (now Art 43 Directive 2006/113/EC) as a basic supply of a service. …
The VAT Tribunal ruled that there were no fundamental differences between acting for a film and acting for a theatre production. Therefore, the supply is related to a cultural, artistic or entertainment activity under Art 9(2)9C) and taxed where performed which in this case is New Zealand.
Most people would argue that a government official is not qualified to decide what should be considered art. The only way to avoid having policymakers decide what counts as art, entertainment, or culture is to remove from the tax code all special provisions relating to these activities.
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