Christie’s Incurs Sales Tax Fine from Manhattan District Attorney

'Rabbit' by Jeff Koons at Christie's
Rabbit by Jeff Koons at Christie’s in New York in 2019.SETH WENIG/AP/SHUTTERSTOCK

The Manhattan District Attorney’s office announced on Thursday that Christie’s will pay a $16.7 million fine for failing to correctly collect New York sales tax from 2013 to 2017. According to a report by Artnet News, the auction house will pay $10 million in full followed by the additional $6.7 million.

The fine’s amount is based on $189 million in taxable sales that took place between 2013 and 2017. Christie’s reportedly failed to collect sales tax on works sold by overseas offices and delivered to clients in New York during that period. The auction house also did not collect New York sales tax when it set out to consolidate its international private sales apparatuses in London.

The District Attorney said in a statement that the auction house “admitted to failing to register to collect and to collect New York and local sales tax despite having a legal obligation to do so.”

Artnet News also reports that tax managers formerly employed by Christie’s attempted to cover up the errors. Those workers were no longer at Christie’s at the start of the District Attorney’s investigation in 2017.

“For the past several years Christie’s has worked in cooperation with the Manhattan District Attorney’s Office to resolve specific issues created as a result of incorrect tax advice Christie’s received regarding the application of sales tax obligations for specific non-US affiliates,” a Christie’s spokesperson said in a statement. “The company has since reviewed its advice and internal processes to ensure compliance with relevant tax law. This settlement agreement brings the matter to full resolution”

Manhattan District Attorney Cy Vance, Jr. praised prosecutors for “completing this meticulous investigation under the extraordinary circumstances of the COVID-19 public health emergency,” adding that investigations of this kind “have put multinational companies across the world on notice that the privilege of doing business in Manhattan comes with the obligation to comply with our tax, business, and criminal laws.”


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