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As the UK Overseas Territory already operates a zero rate for capital gains tax, the government there anticipates a major influx of artworks before long.

The policy announcement came in a pre-Budget speech by Gibraltar's Chief Minister, Fabian Picardo, to the Thomson Reuters European Lawyers conference on June 20.

"We think that, in addition to the absence of capital gains taxes and other fiscal advantages that make us the European jurisdiction of choice in so many areas, this may help stimulate the use of Gibraltar for the acquisition and sale of high value works of art," Mr Picardo told the gathering.

In order to qualify for the tax breaks, artworks would have to be physically imported into Gibraltar, where storage would be a matter for importers and shipping companies in the private sector. Works could be transported directly to the Rock by air or land.

"The measure designed to remove import and export duties on art is one of the many budget measures being taken by the Government to make Gibraltar a more attractive destination for the purchase and sale of high-value art, as well as potentially stimulating new business opportunities for the storage and auctioning of such assets in Gibraltar," Mr Picardo told ATG.

"Gibraltar already boasts no capital gains tax, no stamp duty and no VAT on goods or services; but is a full member of the EU as an Overseas Territory of the UK within the European Continent."

The full budget measure is that 'Import and export duties on all artwork, including paintings; drawings and pastels; sculptures and other statuary; original engravings, prints and lithographs; basketwork and wickerwork, is reduced from 12% to zero (0%)'.

Although Gibraltar is an Overseas UK Territory, it decides its own policy on import duties, which remains solely the responsibility of the Government of Gibraltar.

"With around £40 billion worth of trading activity in the fine art and antiques trade each year, the Government would like to open up business opportunities in Gibraltar for the world's top dealers, auctioneers and collectors. In this respect that Government is eager to listen to all stakeholders in the sector on how best to help them to promote the facilities offered in Gibraltar to the global marketplace, in particular in seeking to stimulate facilities for the storage of high value art on the Rock," said the Chief Minister.