With repeated reports of Paintings of Hussain, Tyeb Mehta
and others selling for crores, the income tax department now
wants a share of the pie. The income tax department is considering
a Tax Collection at Source (TCS) levy on Art sales.
The objective of the tax is to introduce greater transparency
into the art industry which is still very unorganised.
This information can be used as a benchmark for issues relating
to pricing, insurance and value. As of now all sales at high
profile auctions get recorded. Most galleries also record
sales. Yet, private deals struck by art collectors, painters
and dealers do not get recorded.
Last year, the TCS net carrying a 2 % tax rate was extended
to cover parking lots, toll plazas and mining. In case of
art sales, the TCS rate may be as high as 30%, but a final
decision has yet to be taken by the finance ministry sources
said.
