For Artists in Mexico, a Less Taxing Alternative

Roberto Cortazar, one of Mexico’s most dazzling young painters, spends two months every year paying tribute to his country, just as Aztec and Mayan artists did to their rulers hundreds of years before him.

Cortazar is one of 160 artists who paid their 1998 Mexican taxes with their own art. In a program that might have broad appeal to Third World governments, Mexico allows a select group of artists to submit paintings, graphic art or sculptures to settle their tax bills.

The art-for-taxes program not only fosters the visual arts, long a pillar of Mexico’s rich culture, but it also allows the nation to build up an impressive collection of quality work by major artists that state-owned museums couldn’t begin to afford on their own.

“It is a stupendous idea to be able to pay your taxes with your own work,” said Cortazar, 37, who has been doing it for more than 15 years. “And it is rewarding that, at the same time, your work becomes part of the national cultural heritage.”

In this nation where tax dodging is common, a program that manages both to transform the tax authority into a fomenter of culture and encourage artists to meet their tax obligations seems a winning proposition all around.

Mexican officials say they know of no similar program elsewhere, and inquiries are coming in from other developing nations facing similar budget constraints.

“If it became better known, other countries would follow it up,” said Jan Hendrix, a Dutch printmaker who settled in Mexico in 1975 and is one of the program’s most committed participants.

Since renowned muralist David Alfaro Siqueiros first proposed the idea in 1957, the initiative has grown into a formal and competitive program in which hundreds of artists vie to have their works accepted each year. Only 329 works by 160 artists were accepted this year by the judging committee of art historians and critics, out of 704 works that were presented by 226 artists.

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The best artwork-for-taxes is then hung in a 16th century museum in the historic district here, putting artists like Cortazar on display for all Mexicans--not just those who can afford his impressive canvases, which cost from $3,000 to $15,000 each at the Praxis Gallery in New York.

“In countries without a culture of private art donation--a very Anglo-Saxon tradition--this is a great way to enrich the cultural patrimony,” said Juana Ines Abreu, the driving force behind the program in the Finance Ministry.

A few Mexican artists complain that the program is elitist, focusing only on the country’s top names at the expense of lesser-known and more avant-garde artists.

Abreu, whose title is director general for cultural promotion and patrimonial heritage, acknowledges: “We have made a great effort to accept only museum-quality artworks. The artist must have a very professional resume. If the connotation of ‘elitist’ is to achieve quality, then yes, it is.’

The 1998 tax year haul, which went on display at the Archbishop’s Palace Museum in October, reveals the breadth of the annual collections. The elders include Rodolfo Morales, Raul Anguiano, Rafael Coronel and Rina Lazo, who was an assistant to the late muralist Diego Rivera. But many are younger up-and-coming artists like Pedro Bonnin, who is just 30.

“The percentage of artists opposed to it is small compared with the important artists who do respond,” said Julieta Ruiz, curator of the museum. “I believe 70% to 80% of the major artists in the country are participating in the program.”

Even though the normally hardhearted tax department runs the program, nobody in the government seems to know or care how much cash the government is sacrificing each year as a result.

Abreu couldn’t put a value to the annual collection, saying what matters to her more is the quality of the art. In any case, she noted, the value will grow as the years pass.

Changes in the administration of the program cloud any attempt to work out a value for the art “payments.” In the past, artists had to obtain written valuations of their works, which became the basis for the tax credits.

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But that required complex accounting. So a simpler alternative was introduced three years ago: Approved artists can make their full income tax payment by submitting roughly one out of every five works they produce each year, without doing any further accounting at all.

Most artists opt for this method. Finance Ministry spokesman Ramon Castellot said it is thus impossible to determine a value, because the artist’s income is not taken into account.

“Artists hate accounting,” Abreu said. “This lets them avoid it.”

In any case, the tax revenue sacrificed is nominal. Guessing at an average market value of $5,000 for each accepted artwork, the value of the 329 paintings “paid” in 1998 would be about $1.6 million, out of Mexico’s annual federal tax collection of $33.9 billion.

But improving Mexico’s dismal tax collection rate--12.5%, less than half that of developed countries--has been a key government goal throughout the 1990s. That makes creative initiatives such as art-for-taxes important symbols of civic responsibility.

In all, the government has collected 3,500 artworks in lieu of taxes in the 42 years since the program began. And while the number of pieces accepted each year has gone up, the selection criteria also have grown tougher.

“With terrifying visions of neon bullfights painted on black velvet dancing in the selection committee’s heads,” Abreu recalled in a recent speech, “a revised version of the decree was carefully drafted in order to set guidelines that would winnow out anything but excellence and professionalism.”

If the committee rejects an artist’s offerings three years in a row, the artist is barred from further submissions. The panel sometimes requires an artist to substitute another work for the one submitted if it feels a better example is available.

“The artists take it as a challenge, and they really want to be shown,” said Patricia Perez Walters, director of the Finance Ministry’s museums. “The program is intentionally very public; we do a lot of traveling shows.”

Hendrix, the Dutch-born printmaker, has gone further. He has handed over an entire collection of 96 works, which under the law can be credited against future tax liabilities.

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The willingness of Mexican artists to contribute to the public body of art, Hendrix noted, “flows from a very deeply embodied cultural consciousness. The respect for the artist and the relationship of artist with the society has always been very intense.”

Indeed, Abreu told a United Nations cultural conference last year that the art-for-taxes program reflects a tradition in which “artists in Mexico were immersed in revolutionary ideals such as ‘art for the people,’ taking the form of immense murals depicting the nation’s history.”

Siqueiros, one of the great 20th century muralists, proposed the art-for-taxes program in 1957 because he was angry that a fellow artist’s goods had been seized for nonpayment of taxes. Fortunately, the artist made his approach to a cultured bureaucrat, Hugo B. Margain, then director of taxes who went on to become finance secretary and ambassador to the United States.

Margain wrote in a memoir 25 years later: “With vehemence Siqueiros declared that a painter knows nothing of accounting, nor of the complications established in the tax laws. ‘The only thing we have,’ he told me, ‘is our paintings, and if you want, we can pay our obligations to the government by delivering some artworks.’ It seemed to me not a bad idea.”

The plan was approved, and Diego Rivera soon donated his celebrated painting “The Artist’s Studio.” Rufino Tamayo followed with “The Photogenic Venus,” and the program took hold.