The strength of the US dollar against the British pound – at present, the pound has dropped nearly 18% since the beginning of 2022 – would appear to make the purchase of art and other cultural property in the UK and Europe far less expensive for Americans. But the tumultuous state of the world has thrown a multitude of wrenches into British art exports to the US. The (not over yet) pandemic, (nor over yet) Brexit crisis, growing inflation, expanding regulations to prevent anti-money laundering, frustrating global supply chain backups and other issues have made it maddeningly difficult for US-based buyers to acquire art from UK sellers. The effect is thwarting major purchases.
Among the complications is the British government’s January 2021 elimination of tax-free shopping for tourists. According to Sheppard Mullin’s Robert Darwell, without the previously longstanding refund of the UK’s 20% value added tax, “the higher tax burden is discouraging US collectors from buying art from the UK.” This complex set of circumstances complicating UK art exports to the US is the subject of this excellent article in The Art Newspaper, in which Darwell is quoted.
But Darwell, senior partner in Entertainment, Technology and Advertising Practice Group and longtime art law practitioner, argues that US collectors should not abandon hope. This is because special export arrangements with the UK seller can help the collectors waive the value added tax.