Everybody knows the sad story about Vincent Van Gogh: The impoverished artist sold only one work during his lifetime but his paintings are now among the most expensive in the world.
We can’t go back in time, but what if we could fix that kind of inequity today? The artist’s resale right, a royalty levied on sales of art in the secondary market, aims to do just that. It awards artists or their estates a small share of the proceeds when a gallery or auction house resells works that the creator may have sold for a pittance decades before.
Trouble is, not every artist is a Van Gogh. Stories of astronomical gains in art prices make headlines, but most artists never see their work hit the auction market let alone achieve increases that outstrip inflation. As Canada considers adopting the artist’s resale right (ARR), it’s worth asking how much Canadian artists will actually benefit.
The ARR already exists in the European Union, U.K. and Australia (but not the United States), and the government has said it will add the right when it amends the Copyright Act, with a bill expected this year or next. The proposal Ottawa is considering would add a royalty of 5 per cent on any Canadian art resold publicly for $1,000 or more, a threshold set purposefully low to include more artists. (Artists’ estates would be included, and Canada is also expected to be extending copyright from 50 to 70 years after death.)
Proponents of the royalty, notably the Canadian Arts Representation (CARFAC), argue it will add an income stream for artists who make little from their works and let them profit from continuing sales as a songwriter or novelist does. Opponents, mainly the members of the Art Dealers Association of Canada (ADAC), argue the royalty will be paid to a tiny minority of successful artists and will depress sales.
“The overwhelming majority of artists have no traceable resale market, and never will,” said art dealer and ADAC board member Jonathan Klinkhoff. “ARR schemes do nothing to encourage or incentivize the majority of living artists.”
But artists themselves have a different take. “All the business reasons for or against the artist’s resale right are beside the point,” says AA Bronson, the surviving member of the collective General Idea. “The reality is quite simple: If the artist is the creator, they should benefit from the resale the same as an author or a musician does.”
In part, this disagreement stems from two different ways of looking at art. A dealer sells it as a luxury good: You buy it, it’s yours, the same as your car or watch. You resell it 20 years later, whether at a loss or for 100 times more than you paid, that’s your business.
But artists – and Canadian law – don’t see it this way. For starters, artists retain copyright of their images: You can’t print up posters from a painting just because you own it. Artists also retain moral rights, to be identified as their work’s creator and not to see it changed or defaced.
The ARR is an extension of these rights and, in theory, it’s just and justified. Instinctively, people feel artists should share in the windfall when their work is resold at a profit. CARFAC cites the example of the familiar Inuit print The Enchanted Owl by Kenojuak Ashevak: In 1960, she was paid $24 for the drawing from which the prints were made; one of those original prints sold for $185,500 in 2018. But such dramatic increases are the exception and the details of how well the resale royalty works are murky.
First, despite what the Ashevak example suggests, the ARR is not levied on a capital gain but just on the resale price. Whether the seller made a profit or took a loss, the original price would not be taken into account. Second, in most jurisdictions, the seller only pays half; the rest is paid by the gallery or auction house (since they would be taking a cut on the sale). But those brokers simply pass the cost to the buyer, which is why dealers fear it will raise prices and depress sales.
International studies on who benefits show mixed results. Art market economist Clare McAndrew points to research showing that three quarters of the money from resale rights in the U.K. goes to just 50 artists (many of whom are dead), while the distribution in France appears even narrower. Perhaps because it is set at a lower threshold – the same $1,000 as suggested for Canada – the Australian ARR seems more successful in reaching the less wealthy and dispenses almost 40 per cent of its proceeds to aboriginal artists.
Still, the sums are not going to raise anyone out of poverty: In Australia, most fall between the $50 minimum and $500. In Canada, you can guess at obvious beneficiaries, such as the estate of Alex Colville or a figure such as Bronson, an artist with enough clout that he already requires a percentage on resales from dealers who represent him.
Another aspect the Canadian government will have to consider is the impact on Inuit art. The Inuit printmaking co-ops pay artists outright rather than taking work on consignment. They then sell annual print releases featuring dozens of images by multiple artists to Canadian dealers. The ARR would force those dealers to add the 5-per-cent royalty as they sold the prints to clients, driving up prices while possibly suppressing dealers’ appetite for the releases. An exemption for art “bought as stock” might help, but as the government implements the ARR it will need to ensure it boosts Indigenous artists rather than inadvertently disrupting their markets.
The 1960 Cape Dorset print release featured the work of 27 artists, including not only Ashevak but also Pitseolak Ashoona, who would be named to the Order of Canada before her death in 1983. Her estate would benefit from a royalty on any resale that crossed the $1,000 threshold – but today only a few of her earliest prints squeak past that and you can buy examples of her work at auction for a few hundred dollars.
Artists have every right to profit from their success – and to pass their wealth to their heirs. The ARR is fair, but ironically it will do little to address the great inequities of the art market. Nobody should be pitching the resale royalty as some income supplement for starving artists. It isn’t.