The biggest scam on earth are things that are hidden perfectly in plain sight. It’s that illusion that everyone has heard about but no one knows the truth about it. The industry through which the biggest scam takes part has been called one of the manipulated markets in the world. No, it’s not banking, the oil industry, or the media. It is the industry that allows some of the richest people to escape paying taxes. This is in reality is the most sneaky practice you can ever imagine. And that biggest scam industry is Art.
There are things/practices that you can do that allow you to reduce the rate of your taxes legally. You can comfortably utilize these things if you choose to. What you should know is that some practices and systems are only available to the top players and not just anybody. In this writing, you’ll learn about the biggest secret tax scam in the world.
There are certain things in the world that the narratives are well crafted, so you can believe a particular topic when it’s designed for other purposes. The world of fine art is the perfect example of this. You will learn how this world is manipulated to suit the rich and not everyone else.
How is arts used to evade taxes?
The ultra-rich used art as a scam means to avoid taxes, and it’s done in a rather simple way. No, it’s not complicated at all. First, you have to buy art. However, you can’t just part with a certain amount of money to buy art. This would mean spending that money, which isn’t the main goal here, you’re trying to evade taxes not buy art. So, how do you play this scam, and evade paying taxes too?
Find yourself an artist
Go ahead and find yourself an up-and-coming artist with a history of creating arts. Maybe, the artist you found has a small collection of paintings in a local art gallery but they haven’t broken into the mainstream art world yet. You feel they have potential, what you care about, is their potential to save you millions of dollars in tax money.
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So, you buy their paintings, let’s say, for $10,000, bravo, you have bought yourself some paintings, and it didn’t cost you a fortune. However, you need that art to cost you a fortune so you can write off a little tax money. Now, this is the point you call your friends in for help, and this brings us to the next step.
Promote the artist
The fact that you are unbelievably rich means you are connected to people in the high-end art world. These are gallery owners, art critics, appraisers, etc. They are the kind of people who decides what art is worth a lot of money, and what art isn’t. Your appraiser friend could hypothetically value that painting you just bought for $10,000 because that’s what they do for a living.
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If they do it for a new artist without a name in the industry, they might lose credibility. You have to make your artist come off as someone whose art can be sold for a huge sum of money. This is the part where you have to make your artist famous, and boost the value of their artwork is perceived.
Hype them a little bit, by hiring a publicist, who helps get your artist name out there. The publicist will interview him for magazines and feature him n news and art journals. With the help of your art industry friend, you host events in a bigger gallery getting the new artist in front of people that matter. Before long, people will begin to recognize the artist’s work. And people in the art circle begin to know their names.
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Now, that their arts are in big galleries, people start buying those arts at high prices. Of course, making this happen for the artist will cost you money but that’s not the problem. This is because all of these are going to pay off for you in big ways.
Appraising your new art.
Well, now, your artist looks more credible and so hot, in a way that people are starting to talk about him. And they are sharing their work on social media, a few buzzes around their work, and that had cost you a few bucks and change.
With that out of the way, the next move to make your art friends start working in your favor. Right now, your new artist’s name is buzzing in the art world, your art appraiser friend can get to work valuing some of their paintings for a small fee. Before you know it, one of the paintings you bought for $10,000, is now worth, $10,000,000.
This is because the artist isn’t unknown anymore, their work is out there and in demand. You have to know that this kind of price manipulation is very common in the art world. As a result of the price manipulation, you now have an art that is worth, $10,000,000 and it has been certified by an art appraiser. An art appraiser willing to validate its price
Now, that you have a $10,000,000 pie of art that costs you less than that at purchase and to promote, let’s put the final tax invasion piece together.
Donate your art for a tax break
To put together the power play of tax invasion, you have to give away your expensive painting. Governments of many countries love it when people are charitable, and in many cases will them a tax break for donating their assets.
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So, you will donate your valuable painting to a charity of your choice, and voila, your tax-saving scam is complete. Hypothetically, you have spent $10,000 on a painting, and a couple more funds for fees for your artist promotion, and your appraisal friend.
By spending that money, you have saved yourself nine million dollars plus in tax every single year. You can rinse and repeat this as much as you like to bring your tax bill to zero. Making more money? No problem, just artificially inflate the value of some more artworks and donate them to a charity of your choice.
The big club of the art world
Using the art world to dodge taxes only works if everyone is on the same page in the industry. We are talking about art gallery owners, appraisers, art dealers, and a ton of other people. The fine art world keeps a tight-knit community as a result of this. You wouldn’t be able to just work into the art gallery and buy super high and expensive art, just because you have a ton of money. No, it’s mostly known art collectors that are sold arts to. And the reason is that it would drive the future price of the artist’s work upwards. Again, it would be sold to someone in the background of money laundering that serves the art world.
How freeports are used to evade tax
What if you were a part of the art circle(a legitimate art collector of sorts) and you wanted to buy a certain painting, wouldn’t that mean you have to pay sales tax on it? It would. How do you evade paying taxes on this purchase? There is a solution to that.
Freeport does exist in the real world not only in the fictional movie, Tenet, and they are high-security warehouses. They exist all around the world and are special tax-free zones that rich people utilize for their benefit. Rich people stash their stuff in here, so, if you buy an expensive painting at auction, and have it delivered to a Freeport, you’ll never have to pay sale tax on it.
The next time you hear that a painting has been sold for an insanely high amount of money, stop and think. For it could be a legitimate sale or a rich person who has successfully gamed the system to line the pockets of his friends or evade taxes. These are taxes that your government will have to get from somewhere to pay for everything you enjoy in a developed society. Instead of getting tax from the rich art lovers, they get it from you, is that legal? Yes. Is it fair? Not.