Art as Payment: How South Korea's New Tax Law Redefines Inheritance and Culture by Mika (Jaeyun) Noh.

What if inheritance taxes could preserve cultural heritage instead of eroding it? How can fiscal policy become a catalyst for national identity? Could art itself redefine wealth in the modern era?

In the latest edition of The Future of Luxury by Summit Communication Group , guest contributor and my dear friend Mika(Jaeyun) Noh —Legislative Director at The National Assembly of The Republic of Korea and an esteemed art critic—delivers a thought-provoking exploration of South Korea’s revolutionary inheritance tax reform. This incisive article unpacks how a bold policy shift is transforming inheritance from a financial burden into an opportunity for cultural preservation. Mika’s analysis moves beyond policy mechanics to reveal a visionary model where art, governance and identity intersect, offering lessons with global resonance. This is essential reading for CEOs, tastemakers and family offices seeking to understand how cultural capital will shape the future of luxury.

Seoul, South Korea 2025: Inheritance taxes have traditionally been viewed as a financial burden, often forcing heirs to sell valuable assets to meet their obligations. However, in South Korea, a bold new policy is reshaping this narrative by transforming what was once a fiscal challenge into an opportunity for cultural enrichment. By allowing heirs to settle inheritance taxes through the donation of artworks and cultural heritage items, the country has pioneered an innovative approach that not only eases financial strain but also safeguards its cultural legacy. This policy represents a pivotal moment for Korea’s art market and cultural preservation efforts, demonstrating how tax reform can serve as a catalyst for strengthening national identity and fostering public access to art.

A Timely Response to National Needs

The financial and emotional strain of inheritance taxes has long been a concern for families with significant cultural assets, especially in South Korea, where art and heritage hold profound societal value. For years, families inheriting priceless collections faced a stark choice: sell irreplaceable works to pay taxes or risk financial instability. This dilemma became highly visible with cases like the late Samsung Chairman Lee Kun-hee’s family, who faced a staggering approximately USD 11 billion inheritance tax bill, ultimately donating over 23,000 cultural artifacts to the nation. Similarly, Chairman of the Kansong Art Museum, had to auction precious relics like the Golden Triad Buddha Statue to settle taxes. Recognizing these challenges, South Korea’s recent reforms allowing artworks to be used for tax payments mark a transformative shift. This policy not only alleviates financial strain but also ensures that culturally significant pieces remain accessible to the public, reframing inheritance taxes as a tool for cultural preservation rather than a barrier to it.

Preserving Art Through Policy

In response to such challenges, Korea’s government amended the INHERITANCE TAX AND GIFT TAX ACT in 2021 to allow artworks and cultural assets to be used as payment for inheritance taxes. Starting in 2023, heirs can now settle their tax liabilities by transferring paintings, sculptures, prints, and other valuable cultural items to the state. Korea's pioneering move to allow artworks as a form of payment for inheritance taxes, introduced with the 2021 amendment to the Inheritance Tax and Gift Tax Act, is now beginning to bear fruit. In 2023, four artworks were successfully transferred to the National Museum of Modern Art, marking the first official use of the system. This policy not only alleviates the financial burden on heirs but also serves as a strategic effort to preserve cultural assets and enhance public access to art. One standout example is a series by Chinese contemporary artist Zeng Fanzhi, whose works exploring themes of alienation fill a significant gap in Korea’s national collection, highlighting the policy’s potential to enrich public cultural resources.

However, challenges remain. The current framework restricts art payments to only those artworks subject to inheritance tax, limiting the system's full potential. Art professionals and tax experts are calling for a broader application, allowing art to be used for the settlement of all inherited assets, which could dramatically expand the pool of artworks entering public collections. By refining the system, Korea has the opportunity to position itself not only as a leader in cultural preservation but also as a model for integrating art into the financial ecosystem in a way that benefits both heritage conservation and the public’s cultural experience.

The Policy’s Broader Impact

• Preservation of National Heritage: By integrating artworks into public collections, this policy ensures that Korea’s cultural assets remain within the country. These works, now accessible to the public, strengthen national identity and cultural pride.
• Stabilization of the Art Market: Previously, heirs often had to sell artworks quickly to pay taxes, leading to market volatility. This policy alleviates that pressure, creating a more stable environment for collectors, galleries, and artists.
• Enhanced Public Engagement: Transferred artworks can be displayed in museums, fostering cultural education and appreciation. This not only enriches Korea’s cultural scene but also boosts tourism by attracting art enthusiasts from around the world.

Challenges and Opportunities

While the policy is groundbreaking, its success hinges on addressing several challenges:

• Valuation Standards: Art valuation is inherently subjective. Establishing transparent and consistent criteria is crucial to prevent disputes and ensure fairness.
• Management of Acquired Artworks: Museums and public institutions must have the infrastructure and resources to preserve and display the influx of artworks. This requires investment in storage, curation, and exhibition planning.
• Public Accessibility: To maximize the cultural impact, artworks should be actively exhibited, not merely stored away. Programs that promote public engagement, such as educational workshops and community exhibitions, are essential.

A Model for Cultural Diplomacy

Korea’s approach could serve as a model for other nations grappling with similar issues. By turning tax policy into a tool for cultural preservation, Korea has demonstrated how governance can align with the arts to achieve mutual benefits. This policy also enhances Korea’s global reputation as a cultural leader, showcasing its commitment to preserving and promoting its artistic heritage.

The Role of Experts in Shaping the Future

As a cultural policy strategist with years of experience in legislative research and cultural project management, I believe this policy is just the beginning. To fully harness its potential, Korea must:

• Foster Cross-Sector Collaboration: Engage artists, collectors, policymakers, and cultural institutions in discussions about the policy’s implementation and impact.
• Leverage Digital Platforms: Use technology to digitize and promote newly acquired artworks, making them accessible to a global audience.
• Integrate ESG Principles: Align the policy with environmental, social, and governance (ESG) frameworks, emphasizing sustainability and inclusivity in cultural management.

Korea’s innovative use of art for inheritance tax payments is more than a financial strategy; it is a cultural vision. By preserving artworks as public treasures, the policy bridges the gap between economic necessity and cultural enrichment. It is a testament to Korea’s forward-thinking approach to governance and its unwavering commitment to its cultural legacy. As this policy evolves, it presents an exciting opportunity for cultural leaders, policymakers, and art market stakeholders to collaborate and shape the future.

Written by Mika(Jaeyun) Noh

Published Gregory Gray , CEO & Founder of Summit Communication Group

Cover Picture: In 2021, the Samsung family donated over 23,000 artworks collected by the late Lee Kun-hee, former chairman of Samsung Group, to national institutions and local museums. The collection, which includes designated cultural assets, antique artworks, world-renowned Western paintings, and modern Korean works, has garnered significant attention from art enthusiasts and the public upon its unveiling. Visuals of Inwang jesaekdo (Scene of Inwangsan Mountain After Rain, 1751) by Jeong Seon

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