Peter Paul Rubens The Massacre of the Innocents
Source: Art Gallery of Ontario
The Art Gallery of Ontario has entered the final phase of Transformation AGO, the ambitious $257 Million renovation and restructuring project conjured up by Kenneth Thomson, Matthew Teitelbaum, and Frank Gehry. Transformation AGO promises a 47% increase in gallery space, an impressive new facade that will stretch the length of Dundas St, and significant additions to the galleries collection through private donations. The Massacre of the Innocents by Peter Paul Rubens and Bernini’s Corpus highlight these private donations due to their rarity and star factor (yes there are stars in the art world), however the tax receipts issued for these items make up more then half of the galleries budget for its renovation.
How is this possible? Well any private donation made to a government institution or charity in Canada is tax deductible. Once an institution accepts a donation it is sent to the Canadian Cultural Property Export Review Board (CCPERB) for approval. CCPERB consists of 10 board members, four of whom have been officers, members or employees of art galleries, museums, achieves, or libraries and four who have been dealers in fine art, antiques, or objects that form part of the national heritage. If the item is deemed to be of “outstanding significance and national importance” then the board will place a fair market value on the work and issue the donor a tax receipt.
AGO Facade
Source: Gehry International, Architects Inc
This tax break, introduced through the Income Tax Act, has significantly benefited Canada’s cultural institutions by improving public collections such as the AGO’s, however there are drawbacks to the process. The option to donate cultural property enables individuals to avoid Capital Gains Tax and provides them with a tax credit that they must use in five years time. As a result, the public ends up paying for the expansion of cultural collections while the donor gets a considerable break.
A donor could potentially make money through this process as well. For example if a donor purchased a painting for $5 million and in that same year donated the piece and had it valued by CCPERB for $10 million then they would potentially make $5 million if their income tax over five years was higher then $10 million.
Gian Lorenzo Bernini, Corpus
Source: Art Gallery of Ontario
So far it seems that these drawbacks out weigh the advantages of the tax process and Toronto is a fine example. Five of Toronto’s top cultural institutions have received significant donations over the past five years including the Art Gallery of Ontario, the Royal Ontario Museum, the National Ballet, the Gardner Museum of Ceramic Art, and the Toronto Opera Company, but it is important to keep in mind that while wealthy patrons are improving cultural collections the Canadian pulic are footing the bill.
