Bought a $450M painting? In NY, don’t worry about the tax
NEW YORK » New York collects sales tax on even the smallest items, but it probably won’t collect a cent on a nearly half-billion dollar painting by Leonardo da Vinci.
The Italian Renaissance artist’s “Salvator Mundi” sold for $450 million (380 million euros) during a record-breaking auction at Christie’s last month by a Saudi prince and appears to be headed for display in a museum.
But unless he decides to hang the work in a Manhattan pied-a-terre, or ships it using a certain type of carrier, he’ll likely be spared the roughly $39 million in sales taxes a regular New Yorker would have to pay for buying a work of art at that price at a local poster shop.
That’s because the state’s laws are structured so that out-of-town buyers generally don’t get hit with big tax bills. If they did, New York’s status as a global center for art sales might be jeopardized, an expert said.
Christie’s declined to identify the buyer of the 500-year-old artwork, but the Saudi Arabian embassy in Washington, D.C., said in a statement Friday that a member of the royal family, Prince Bader bin Abdullah bin Mohammed bin Farhan al-Saud, had purchased the painting on behalf of the Department of Culture and Tourism in Abu Dhabi, capital of the United Arab Emirates, so it could be displayed there at the newly opened branch of the Louvre museum.
The Wall Street Journal and New York Times both reported Thursday that Bader was actually acting as a proxy for Saudi Arabia’s crown prince, Mohammed bin Salman.
The identity of the owner and ultimate destination of the artwork plays a big role in whether the sale is taxed.
If the painting of Christ raising a hand in blessing had been bought by someone who planned to keep it in New York, the buyer would be on the hook to pay an 8.875 percent state and local sales tax, which on a $450 million purchase would amount to around $39 million (30 million euros), said Jason Kleinman, a lawyer who advises art collectors on the tax consequences of their purchases.