Dolce and Gabbana to Stand Trial for Tax Evasion


Through the years, many well-known Italian designers have been accused of, and tried for tax evasion. The list includes Roberto Cavalli, who the Italian government said evaded taxes by putting expenses linked to his villa renovation in his company ledgers, and Valentino who was fined $39 million after moving his home to London, keeping his business in Italy, and failing to pay Italian taxes. Designers Dolce and Gabbana are now set to join their ranks. The duo, known for their love of animal print, and the recently released brocade embroidered dresses, were released from tax charges last year by a court in Milan. However, prosecutors have reinstated the charges in a higher court, alleging that the designers owe $400 million to Italy for selling their business to a Luxembourg based holding company to avoid paying Italian corporate taxes. Traditionally, designers accused of such offenses receive a fine, are acquitted, and avoid jail time. However, for Dolce & Gabbana, this may not be the case, and the designers may face up to five years in jail if convicted.

The government under Prime Minister Mario Monti has been hunting down tax evaders and prosecuting, going as far as to stop drivers of luxury cars to determine if it is a business vehicle being used personally, and if the owners have paid appropriate taxes. Neither of the designers attended the first day of the trial, but their lawyer has requested the case be thrown out for a technicality. A ruling is set for sometime next week.

Source courtesy of The Daily Beast. Image courtesy of Twylah