Craziness in Spain

pruebas

I was looking at the upcoming Cayón auction, to be held in Madrid on 4 February 2012 and came to the following terms:

<<The collection is in Madrid under temporary importation. This means that any purchase delivered in Spain or sent to other European city has to pay also the importation VAT (8%); SO A 25.2% (comission plus importation tax of 8 per cent) MUST BE CHARGED OVER THE HAMMER PRICE. For instance: total to be paid for a 100 Euro hammer coin will be 125.2 Euro (plus shipping and insurance). HAMMER PRICE WILL BE INCREASE BY 25.2%.

Coins sold to buyers outside the European Union will be reexported. So there is NO VAT.

But the Cultural Item Exportation Fee must be paid to the Secretary of Culture of the Government of Spain. This fee, progressive or by sections of application, is a 5% minimum (up to 6000 Euros), 10% (from 6001 to 60,000 Euros) and 20% (from 60,001 to 600,000 Euros). For instance, for coin valued 8000 Euros, exportation fee to be paid is 499.90 Euros. For coin value of 100,000 Euros, exportation fee is 13,699.70 Euros.

Reexportation and exportation fee process will be done by Cayón Subastas, s.l. under your name for free.
Since payment is done, process will take approximately 5 to 9 weeks.>>

The first part has been standard procedure for quite a while. The second part (Cultural Item Exportation Fee) is apparently new. It's not only the money, but the time involved.

Has Spain gone mad?

TwoKopeiki

Wow. On top of that, I'm still on a hook for the HST on the import into Canada. This will curb some of my spending at Aureo and Cayon for sure.

pruebas

Couple of comments:

1) Since the coins (in this particular auction, at least) are only temporarily imported into Spain for auction, how can the government charge a Cultural Item Exportation Fee?

2) This charge certainly appears bound to lower prices realized for coins auctioned in Spain. Why would someone outside of Spain want to consign their coins to Cayón, Aureo, and other Spanish auctioneers? Seems to me the benefits of auctioning coins in Europe now swing even more to Germany.

3) At some point, especially for a large purchase, it would appear faster and easier (and possibly cheaper) to pay the VAT and have someone pick the coins up in person and carry them out of Spain. I don't know what happens if the X-ray folks discover coins being exported nor what happens if you try to get Spanish Customs to stamp your paperwork proving the coins were exported (allowing your VAT to be refunded by the auction house). Perhaps you will be levied the fee on the spot at the airport?

coinkat

It seems that governments of various countries are no friends of those that are trying to preserve the coinage history of the world

JCMhouston

Wow, glad I am not bidding on, or selling, anything in Spain.

SYRACUSIAN

With the exception of the Cultural Item Exportation Fee (which I admit of never having heard about before), Spain is not the only country whose auction houses charge a substantial additional amount to their lots. In a recent important auction in London, the fees were as follows:

Buyer's Premium:-------> 20%
VAT on BP: 20%---------> 4%

Additional fee if the lots were paid by credit card ------------> 2%

The total additional charge was 24%-26%, a rather substantial percentage regardless of each lot's realized price.

Why would someone outside of Spain want to consign their coins to Cayón, Aureo, and other Spanish auctioneers?

For consignors, I assume that the attraction is the possibility to reach local and European bidders, specifically interested in Spanish or Latin American lots, and who wouldn't attend otherwise. It is not at all unusual for several coin collectors, mostly oldtimers, to avoid participating in auctions that they cannot attend in person. As for online bidding, it is an option that they refuse to consider.

For buyers, the attraction can only be the lots themselves. In the example that I've used of the English auction house, there were several important lots, some of which hadn't appeared in the auction block for decades. The realized prices of a particular section that I was interested in, were in most lots, multiples of the auctioneer's high estimates.

German auction houses aren't that far behind. In fact, I can think of two of the biggest German auctioneers, where the total additional percentage on the hammer price has been in the whereabouts of 22-26% for several years and I have the invoices to prove it.

US auction houses are the only ones that come to mind, where the BP and other expenses are still kept in the 15-17% vicinity. The downside for European consignors, is the USD/euro ratio, that favors the buyers whose income is in euros. You'd think that the market would have automatically adjusted realized prices, with this currency exchange ratio in mind, but in my experience, the overall balance still favors the bidders.

YQQ

I have never seen a large German auction house , at least the half a dozen or so I deal with, charging 22-26% in aggregate for a lot.
Unless you physically take possession of your winnings and do not live within the EU, the VAT does not apply. Vat does however apply to the actual fee.
Most are charging 2-3% if you use a CC. Some are waving that CC fee. an auctioneer I know personally told me recently that the German Tax people are trying to add the VAT to the CC fee if charged, as it is apparently a Service and hence taxable.
If they do not advertise a fee for it, apparently it would not be taxable.
BUT if you are a regular and solid good client, they will give you a break on the Buyers fee! This has to be negotiated beforehand.
And usuall they agree if you are a good client buying lots, I mean tons. The same applies to selling your items with them. I have been offered a sellers fee of as low as 8%.
I have seen smaller auction houses with maybe 2-3 auctions a year with the fees you mention. one even at 28%.
They also have their nose so high in the wind that they completely ignore and forget that there are more buyers with "NOT" so much money.
I am not at all surprised that all auctioneers are Fat cats...., think about it...
You have them sell a coin worth 1000. they accept it at their terms and start it at 500.
they tell you it will go up but they must create the interest with a low starter.
lets say it goes for 1000. auctioneer gets paid nearly immediatel. 1000 + buyers 150 fees+VAT etc.. etc... end cost roughly 1200.. money in his pocket immediately. then he pays out the VAT, leaves him 1150.
2 months later he pays you the selling price, 1100 less the 15% sellers fees 165, less VAT 19% on services = 52. You get 835.
anothere scenario is this. It is regularily done.
auctioneer accepts the same 1000$ coin on his condition.
call price is 600. Nobody buys the coin and it goes in the "after auction sale less 10 (some less 15%)%" of the call price. All other buyers fees etc apply!
the coin is then purchased by the auctioneer which you do not know of.
so here is the invoice.
call price 600
less after auction discount -60
less 15% sellers fee -80
less VAT on sellers fee -3.50
You get a mere $ 455!!!!!!!!!!!!!!!!!!!

2 or 3 auctions later YOUR coin shows up in another auction, advertised as tops and rare with a super image , starts at 1000 and sells for 1400.....
you can figure out how much profit they make with your items......
this all beats me...

MrEureka

Reexportation and exportation fee process will be done by Cayón Subastas,

Because the terms differentiate between exportation and re-exportation, I'm not sure that the exportation fee is applicable to re-exported lots. Will need to look into that.

pruebas

I looked at the terms of Cayón auctions from earlier in 2011 and in 2010. The Spanish terms all mention "tasa de exportación" but the English terms do not.

So I am unable to determine if this is a new charge (as I thought) or one that previously existed but never applied to my lots.

Could it be that this fee only applies to ancient coins being exported from Spain (pre-sixteenth century)???

SYRACUSIAN

I have never seen a large German auction house , at least the half a dozen or so I deal with, charging 22-26% in aggregate for a lot.


I will be happy to PM you the names of the two auction houses I have in mind, but I won't do it in a public forum, especially one, where there are several members who are regular clients of both.


Unless you physically take possession of your winnings and do not live within the EU, the VAT does not apply. Vat does however apply to the actual fee.

That's incorrect. It's actually the opposite for EU citizens. It would be too long to explain how it works and I do not want to further abuse space for this subject.

Regarding the private deals with auction houses and lower buying or selling premiums, it's an entirely different matter. I believe that a collector is always better off if he entrusts a reliable agent to do the viewing, shopping and deal with the auction house on his behalf, as the agent will in most cases strike a better overall deal, including his own commission, but this is only my personal opinion.