It would be linked to the duration of copyright, expiring 50 years after the death of the artist.
Sepuloni said the changes would be brought in with standalone legislation the Government expected to be enacted by late 2024.
She said it would bring New Zealand in line with 80 other countries, and was a confirmation of artists' rights.
"This is about fairness," she said. "Beyond the monetary acknowledgement, this is confirmation for artists that they have rights, and their cultural and societal contribution is valued.
"I believe we've struck the right balance between allowing a valuable and important resale market to flourish, and respecting the contribution of the original creators of art."
It would be managed through a non-government, not-for-profit collection agency, which after initial establishment and operational costs would become self-sustaining through administration fees from the royalties set through regulation.
Sepuloni said it would bring benefits to artists while also minimising any administrative or compliance burdens on art market professionals.
"The establishment of this scheme is a really important step to support emerging and established visual artists in Aotearoa.
"We have engaged with the New Zealand art sector, including with artists, including Māori and Pacific artists, art experts, art market professionals, public galleries and museums, and key sector organisations."
The EU trade deal is expected to be officially signed next year.
