In 2025, NAVA made a detailed submission to the NSW Government’s Art of Tax Reform consultation, outlining practical reforms to support the arts and creative industries.
The submission identifies structural issues that keep artists in precarity and proposes cost-effective solutions to ease financial pressures and promote long-term sustainability. A summary of NAVA's proposed reforms is below followed by a link to the full submission.
1. Tax exemptions for prize money, fellowships and government grants
Exempt all arts prizes, fellowships and government grants from taxable income (mirroring Prime Minister’s Literary Awards), recognising them as irregular income that supports creative development.
2. Improve access to income averaging
Expand awareness and uptake of the ATO’s income averaging provisions through better guidance, improved MyTax functionality, and targeted outreach to artists and tax professionals.
3. Exempt artists from Non-Commercial Loss (NCL) rules
Remove arbitrary income caps and asset tests by exempting artists from NCL rules where they meet the ATO’s “in business” test under TR 2005/1, ensuring the rules reflect how creative practices operate.
4. Continue and boost the instant asset write-off scheme for artists
Retain and expand the instant asset write-off scheme to support artists’ investment in tools, materials, and artworks, while also encouraging businesses to purchase artworks.
5. Allow living cost deductions for artist residencies (up to 12 months)
Recognise artist residencies as legitimate professional activities by making living costs tax-deductible, aligning with research and development (R&D) expense treatment.
6. Reduce the GST and HECS burden on low-income artists
Allow artists to opt into GST registration only when income consistently exceeds the threshold and exempt original artwork sales and studio leases from GST for artists not registered for GST.
7. Expand allowable deductions to include ICIP-related expenses
Recognise Indigenous Cultural Intellectual Property (ICIP)-related costs as legitimate tax-deductible expenses for First Nations artists.
8. Introduce exhibition tax relief for museums and galleries
Develop an Australian version of the UK’s Exhibition Tax Relief to offset production and display costs for public-benefit exhibitions.
9. Strengthen tax settings for giving and donations
Allow artists to opt into GST registration only when income consistently exceeds the threshold and exempt original artwork sales and studio leases from GST for artists not registered for GST.
10. Enable tax deductions for volunteer expenses
Allow volunteers in the cultural sector to claim reasonable out-of-pocket expenses as tax deductions, like work-related expense deductions for employees.
11. Extend Fringe Benefits Tax (FBT) concessions to arts not-for-profits
Arts not-for-profit organisations with Deductible Gift Recipient (DGR) status granted eligibility for FBT concessions related to salary sacrificing, similar to those available to Public Benevolent Institutions (PBIs).
12. Introduce levies to support the arts
Establish targeted levies on high-turnover sectors and AI/tech companies to create a dedicated, independent fund for visual arts and remunerate creators.
13. Reform property and tax settings to secure affordable creative workspaces
Provide property tax relief for landlords leasing space at below-market rates, GST exemptions on studio and gallery leases for non-GST-registered artists, planning incentives to convert unused spaces, and vacancy taxes to unlock under utilised properties for cultural use.
14. Amend the Superannuation Act for artists
Amend the Superannuation Guarantee (Administration) Act to ensure artists are paid superannuation on a wider range of income streams, including exhibition fees, paid talks, workshops, and research and development time in residencies.
15. Reform Self-Managed Superannuation Fund (SMSF) investment rules for art
Repeal restrictive 2011 regulations by reducing storage, insurance, and compliance burdens, making art investment through SMSFs viable again.
16. Comprehensive national study into the visual arts, craft and design sector
Alongside urgent tax and superannuation reforms, commission a government-led review to map the sector, quantify its cultural and economic contribution, and make evidence-based recommendations to guide long-term sustainability and growth. This would be the first comprehensive study since the 2002 Myer Inquiry and is needed to ensure future policy settings keep pace with sector realities.
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