J J Bouttats and J Chapman 'A View of the Main Front of Beningbrough Hall'

The 'Living And Giving' Campaign

A tax incentive to encourage lifetime giving to our public collections has been a long-term aim of the Art Fund for many years. As early as 1992 a paper was presented to then Conservative government but subsequently rejected, although the issue was revisited several times during the 1990s. The Budget 2000 was entitled ‘Getting Britain Giving’ and, as the Finance Act 2001 extended income tax relief to include gifts of listed shares, land and buildings to charities, our proposal was seen by many to be a logical extension to the government’s policy. The Goodison Review (‘Securing the Best for our Museums: Private Giving and Government Support’), published in January 2004, certainly judged it to be so; it recommended that the government should take steps to encourage individual giving by means of income tax relief on gifts of works of art, but the proposal was never implemented.

In late 2004, following conversations with key people from the arts world, the Art Fund drew up a new proposal for an income tax incentive. The proposal, entitled ‘Living and Giving’, was very simple. In return for the donation of a cultural or heritage object to a public collection, the donor would receive – subject to certain conditions – a deduction from his or her income tax bill. The scheme would encompass gifts of all kinds – from works of art to manuscripts to archaeological treasures – and recipient institutions would include museums, galleries and many libraries and archives. ‘Living and Giving’ was designed to stimulate individual giving and would result in a significant enrichment of our national and regional collections, at little cost to the public purse. We were determined that the incentive, given against income rather than capital taxes, would be accessible to ordinary donors – not just wealthy collectors – and would be of particular benefit to local and regional institutions. It would also complement the work of Renaissance in the Regions and contribute to the strengthening of civic pride and cultural involvement.

The British Library is whole-heartedly in support of [this] proposal and would like to congratulate the Art Fund on producing such a well thought-through and extremely clear document'

Lynne Brindley, Chief Executive, British Library

A paper produced by the Art Fund ('The Acquisitions Problem')  also showed how public funding for acquisitions had greatly diminished in recent years, while the price of pre-eminent cultural objects had rocketed. While national museums were struggling to acquire the situation was dire for regional collections. Many local museums had no purchase grant at all and had practically given up acquiring significant items. In addition, we highlighted the acute problem of collecting international and contemporary art, which is almost exclusively the preserve of the private collector. It was clear that our proposal for a new tax incentive was based on a very real and pressing need which urgently needed to be addressed.

In 2004/5 the Art Fund examined how similar tax schemes operated in other countries. The results were encouraging. We found similar tax incentives had been in place for some years in Australia, the Republic of Ireland, the USA and Canada and had been remarkably successful. In Australia  for example, over 8,000 individual items, worth over A$300 million (£125m), have been given to local, state and national institutions, since their tax relief scheme began in 1978. These donations include objects as diverse as an Anthony Caro sculpture, Alfred Sisley’s A Path at Les Sablons and costumes worn in the film Muriel’s Wedding (the latter donated by the film’s producer).

The campaign began in earnest in January 2005 when the Art Fund submitted its ‘Living and Giving’ proposal to the Chancellor, Gordon Brown, and consulted the arts sector. The proposal was sent to over 550 key individuals and organisations, including museums and galleries, Arts Council of England, the Museums Association and many private collectors and dealers. Our consultation generated an overwhelmingly positive and supportive response.

A timely proposal [which would] help to rejuvenate regional collections, civic pride and philanthropy. Relief for lifetime giving is especially relevant for developing collections of contemporary art in the regions, which is one of our major concerns...We give the Art Fund proposal our full support.'

Sir Christopher Frayling, Chairman, Arts Council England

The ‘Living and Giving’ campaign gained momentum in spring 2005. The proposal won the support of a cross-party group of MPs when the Culture, Media and Sport Select Committee recommended ‘an extension of the Gift Aid arrangements, so that donations of significant art works to public collections can be offset against income tax’, in their report, 'The Market for Art' (6 April 2005) . The Art Fund also managed for the first time to secure manifesto pledges on the issue from the three main political parties ahead of the 2005 general election. The Conservative party pledged to ‘examine whether the tax system can be better used to create a ‘Culture of Giving’ by encouraging private donations of both works of art and money from the private and corporate sector’. Meanwhile the Labour Party promised to ‘explore further ways to encourage philanthropy to boost the quality of our public art collections’. The Art Fund built on these successes by continuing to meet with key advisors and officials in the Department for Culture, Media and Sport (DCMS), No. 10 and HM Treasury to discuss our ideas.

The Art Fund once again submitted the proposal to the Chancellor in summer 2005, along with a package of supporting material, including a list of key organisations and individuals who actively supported the campaign. The submission reinforced that the ‘Living and Giving’ proposal was designed to meet a very real and pressing need – the inability of our museums and galleries, especially at a regional level, to acquire significant works for their collections. We argued that, as increased government funding for acquisitions was unrealistic in the present expenditure climate, the Treasury must find ways to encourage individual giving to help museums enrich their collections.

'The proposal seems wholly admirable and we welcome and support it wholeheartedly'

Sandy Nairne, Director, National Portrait Gallery

Treasury officials were appointed to examine our proposal ahead of the 2006 Budget. During the Autumn we followed up our original submission with copies of the hundreds of letters of support we had received during the course of the year; including those from Michael Palin, Joanna Lumley and Jon Snow, as well as key people from museums and galleries and many Art Fund members and patron members. It was encouraging that many individuals indicated that they would be prepared to donate objects under the scheme should it be introduced.

However, in December 2005 the Treasury informed us that it would not be implementing our proposal. This was very disappointing, especially in view of the enormous effort that had gone in to the campaign, the overwhelming support it had won from the museum sector, and the fact that Treasury officials themselves had recommended its adoption to ministers.

Despite this news, some positive outcomes have emerged. A tax incentive to encourage individuals giving to public collections has been the aim of the Art Fund – and others – for more than ten years, and we have succeeded in pushing the issue on to the government’s agenda. The government has now confirmed that it now wants to work with the Art Fund to find other ways of promoting philanthropy in our museums. The Art Fund will continue to press the case harder than ever for more generous financial support for museum acquisitions.