No C 76/10 Official Journal of the European Communities 28. 3. 89 
Proposal for a Council Directive supplementing the common system of value added tax and 
amending Articles 32 and 28 of Directive 77/388/EEC — Special arrangements for second-hand 
goods, works of art, antiques and collector's items 
COM(88) 846 final 
(Submitted by the Commission on 11 January 1989) 
(89/C 76/02) 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 99 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Having regard to the opinion of the Economic and Social 
Committee, 
Whereas, in accordance with Article 32 of Sixth Council 
Directive 77/388/EEC of 17 May 1977 on the harmoni­
zation of the laws of the Member States relating to turnover 
taxes — Common system of value added tax: uniform 
basis of assessement (*), as last amended by the Act of 
Accession of Spain and Portugal, the Council is to adopt a 
Community taxation system to be applied to used goods, 
works of art, antiques and collector's items; 
Whereas the present situation, in the absence of Com­
munity legislation, continues to be marked by the 
application of very different systems which cause distortion 
of competition and deflection of trade both internally and 
between Member States; whereas these differences also 
include a lack of harmonization in the levying of the own 
resources of the Community; whereas consequently it is 
necessary to bring this situation to an end as soon as 
possible; 
Whereas the Court of Justice has, in a number of 
judgments, noted the need to attain a degree of harmoniz­
ation which allows double taxation in intra-Community 
trade to be avoided; 
Whereas the objective of achieving a single market by 
31 December 1992 means that Community rules with the 
purpose of avoiding as far as possible double taxation and 
distortion of competition between taxable persons, must be 
adopted before that date; 
(!) OJ No L 145, 13. 6. 1977, p. 1. Whereas the aim of the elimination of double taxation and 
distortion of competition may be achieved by providing for 
the same system both for the period before and for the 
period after the realization of the single market, which 
would in any event be a simpler solution; 
Whereas, for certain items of a cultural nature, a special 
measure should be envisaged to promote the conservation 
and enrichment of the cultural heritage of the Community, 
HAS ADOPTED THIS DIRECTIVE: 
Article 1 
Directive 77/388/EEC is hereby amended as follows: 
1. Article 32 is replaced by the following: 
'Article 32 
Special arrangements for second-hand goods, works 
of art, antiques and collector's items 
A. Scope 
1. Member States shall apply value added tax to 
supplies of second-hand goods, works of art, antiques 
and collector's items, in accordance with the following 
provisions. 
The special arrangements shall not cover precious 
metals and precious stones. However, they shall apply 
to supplies of objects as referred to in the previous 
subparagraph made of gold or any other precious metal 
or containing precious stones, where the value of such 
materials incorporated does not exceed 50 % of the 
selling price of those objects. 
2. For the purposes of this Directive: 
(a) 'second-hand goods' means movable property that 
has been used and is suitable for further use as it is or 
after repair, including all means of transport; 
28. 3. 89 Official Journal of the European Communities No C 76/11 
(b) 'works of art' means the objects listed at 1 in 
Annex H, with the exception of those supplied by 
their creator or his successors in title; 
(c) 'collector's items' means the objects listed at 2 of 
Annex H, except when first supplied; 
(d) 'antiques' means the objects listed at 3 of Annex H. 
3. The special arrangements shall apply to supplies of 
goods as referred to in paragraph 1 where they are 
effected by a taxable person ('taxable dealer') who 
acquires such goods in the course of his business from a 
private person or from a taxable person who was not 
entitled to deduct VAT when he acquired them, with a 
view to resale. Any taxable person engaged in the 
occupation of intermediary shall also be deemed to be a 
taxable dealer if, in accordance with Article 5(4)(c), he 
dispatches goods as referred to in paragraph 1 under a 
sales or purchase commission contract. 
4. The special arrangements shall not apply to 
supplies of goods by a taxable dealer where he has 
acquired them from a taxable person who has invoiced 
the VAT in accordance with Article 22(3) or where they 
have been imported by a taxable dealer and were subject 
to value added tax on importation. 
Where his activities lead him to use the normal 
arrangements at the same time as the special arrange­
ments, the taxable dealer shall keep separate accounts, 
according to the rules laid down by the Member States, 
for operations coming under one or other arrangement. 
Member States may oblige taxable dealers to exercise 
their right to deduction for operations carried out under 
the normal arrangements only at the moment of supply. 
B. General rules of application 
1. The taxable amount shall be the difference, for each 
transaction, between the selling price and the purchase 
price. The selling price shall be the price charged by the 
taxable dealer without value added tax. The purchase 
price shall be the tax-inclusive price paid by the taxable 
dealer. 
However, Member States may, in order to simplify the 
procedure for levying the tax and subject to the consultation provided for in Article 29, take as the 
taxable amount the difference recorded over each tax 
period between the total amount of supplies before tax 
and the total amount of purchases after tax. The 
application of this provision must not have the effect of 
giving rise to distortions of competition. 
2. The taxable dealer shall not have the right to deduct 
any tax paid at the time of purchase of the goods which 
are the subject of supply by him. The tax relating to that 
supply may not be stated separately on the invoice or 
any document serving as an invoice. 
C. Rules for application to particular goods 
For works of art, collector's items and antiques as 
referred to in A(2) (b) (c) and (d) the following shall also 
apply: 
(a) by way of derogation from Article 15(1) and (2), 
supplies of these goods by a taxable dealer shall not 
be exempt from tax where they are dispatched or 
transported to a third country; 
(b) by way of derogation from Article 2(2), these goods 
shall be exempt where they are imported from a 
third country by a taxable dealer. 
However, works of art and collector's items which 
have been exported with exemption from value 
added tax during the 36 months preceding their 
importation by a taxable dealer shall not qualify for 
exemption from tax on import; 
(c) these goods shall be exempt from tax where they are 
imported by cultural organizations recognized as 
such by the Member State concerned under the same 
conditions as those set out under (b) for taxable 
dealers. 
D. Option 
Taxable dealers who qualify for the special arrange­
ments may for each supply to taxable persons opt for 
application of the normal value added tax arrange­
ments. In this case the conditions set out under A(4), 
second subparagraph, shall apply.' 
2. The following paragraph 6 is added to Article 28: 
'6. Until the date of abolition of taxation on 
importation and remission of tax on exportation in 
No C 76/12 Official Journal of the European Communities 28. 3. 89 
trade between Member States, the latter shall apply the 
provisions set out below: 
(a) By way of derogation from Article 15 (1) and (2), the 
supply by a taxable dealer of goods as referred to in 
Article 32 A(2) shall be taxed, in accordance with 
the provisions of that Article, where those goods are 
dispatched or transported to another Member State. 
(b)By way of derogation from Article 2(2), goods as 
referred to in Article 32 A(2) shall be exempt where 
they are imported from another Member State by a 
taxable dealer of the Member State of importation. 
(c) Member States shall apply to the supply of goods as 
referred to in Article 32 A(2) a rate equal to that 
applied to the equivalent new goods. 
(d) The invoice supplied by the taxable dealer within the 
meaning of Article 32 B(2) shall state the rate of VAT and show that it has been paid so that double 
taxation can be avoided.' 
3. The Annex hereto is added as Annex H. 
Article 2 
1. Member States shall take the measures necessary to 
comply with this Directive not later than 1 January 1990. 
2. Member States shall inform the Commission of the 
provisions they have adopted for the application of this 
Directive. 
Article 3 
This Directive is addressed to the Member States. 
ANNEX 
'ANNEX H 
Definitions of works of art, collector's items and antiques 
1. Works of art are those falling within the following categories: 
— paintings, collages and similar decorative plaques, drawings and pastels, executed entirely by hand, 
other than plans and drawings for architectural, engineering, industrial, commercial, topographical or 
similar purposes, hand painted or hand decorated manufactured articles, theatrical scenery, studio 
backcloths or the like of painted canvas, 
— original engravings, prints and lithographs, being impressions produced directly in black and white or in 
colour of one or of several plates wholly executed by hand by the artist, irrespective of the process or of 
the material employed by him, but not including any mechanical or photomechanical process, 
— original sculptures and statuary, in any material, but not including mass-produced reproductions as 
works of conventional craftmanship of a commercial character. 
2. Collector's items are those falling within the following categories: 
— postage or revenue stamps, stamp-postmarks, first-day covers, postal stationery (stamped paper), and 
the like, used, or if unused not of current or new issue in the country to which they are destined, 
— collections and collector's pieces of zoological, botanical, mineralogical, anatomical, historical, 
archaeological, palaeontological, ethnographic or numismatic interest. 
3. Antiques are items, other than works of art or collector's items, of an age exceeding 100 years.'