NEW YORK • The United States has started a trade war with China and art is caught in the crossfire.
The US administration announced this month that President Donald Trump had proposed duties as high as 25 per cent on US$200 billion (S$272 billion) worth of imported Chinese goods, "to encourage China to change its harmful policies".
The proposed tariffs, initially set at 10 per cent, followed two earlier rounds of penalties.
The latest list of targeted Chinese goods ran to 205 pages. It included sandblasting machines; eels, fresh or chilled (excluding fillets); hats; and, at the bottom of the last page, paintings and drawings executed entirely by hand, original sculptures, and antiques more than 100 years old.
The tariffs would apply to all artworks that originated in China, regardless of how they entered the US.
That means American buyers could be required to pay 25 per cent more for a Ming dynasty bowl sold by a British owner at an auction in New York, as well as for a painting by a young Beijing-based artist at a gallery in Hong Kong.
The announcement has caused outrage in the art world.
Mr James Lally, founder of J.J. Lally & Co, a dealer based in New York that specialises in Asian art, said the proposed tariffs were "a matter of great concern" to museums, collectors, curators and dealers worldwide.
"It will have a chilling impact," he said. "It will quickly reduce the market for Chinese art in America to a backwater."
Professional organisations, such as the Art Dealers Association of America, the Association of Art Museum Directors and the British Antique Dealers' Association, have also stated their opposition to the proposal.
Dozens of companies voiced concerns to trade officials during public hearings in Washington last week, many warning that the proposed tariffs would hurt US consumers.
Mr Peter Tompa, a lawyer based in Washington, represented two lobbying groups that work on behalf of museums, dealers and collectors at the hearings last Wednesday.
Mr Tompa said a member of the trade committee asked him one question: As art is a luxury item, wouldn't people pay?
Mr Tompa said he had told the committee that the main problem was slow turnover of inventory in the art trade and that a tariff would mean greater capital outlays by dealers.
"Dealers will need to pay up front, but it may take a while to make good," he said, adding that dealers also had to cope with a recent Supreme Court decision to allow Internet sales to be taxed.
Sotheby's, Christie's and the Asia Week New York association of dealers said in a written complaint that the US, not China, would be affected most.
"Imposing duties on Chinese-origin art will not impact the trade practices or policies of China, as the vast majority of such artwork is imported into the US from countries other than China," the complaint read.
And the US market is small compared with the amount of Chinese art and antiquities sold in China.
Last year, US$7.1 billion worth of Chinese art and antiques were sold at auctions across the world, according to a report published this month by Artnet.
Of these sales, US$5.1 billion came from auctions in China, where the operations of foreign auction houses are restricted; US$408 million came from the US, although that number was up 62 per cent from 2016, compared with a 6 per cent increase for China.
Dealers have pointed out that adding a 25 per cent duty to the fees known as the "buyer's premium" could deter buyers and sellers of Chinese art at auctions in the US, reversing growth in that sector.
"It's not punishing the Chinese. It's punishing the Americans," Ms Gisele Croes, a specialist in ancient Chinese artworks who is based in Brussels, said of the proposed tariffs.
"The international trade will go back to London, Paris and Hong Kong."
NYTIMES
