Thursday, June 20, 2013

Famous Italian designers, Dolce and Gabbana sentenced to jail for tax evasion

Domenico Dolce and Stefano Gabbana, whose clients include Angelina Jolie, Beyoncé, Scarlett Johansson and Naomi Campbell, were found guilty on Wednesday of evading around 400 million euros (£342 million) on a one billion euro business deal - the sale of their D&G and Dolce & Gabbana brands to a holding company in Luxembourg in 2004.
Prosecutors said the sale of the brands to Gado, the holding company that the fashion duo set up, enabled them to avoid a high rate of tax in Italy and pay a lower rate in Luxembourg, thus defrauding the Italian state.
The duo were handed a 20-month suspended prison sentence and a heavy fine on Wednesday for hiding hundreds of millions of euros from the Italian tax authorities. The design duo, who are nearly as famous as the stars they dress, were not present in court in Milan and will lodge an appeal against their conviction on charges that they have always denied. "We will read the reasons for the verdict, and we will appeal," Massimo Dinoia, one of the pair's defence lawyers, said after the hearing. Public prosecutor Gaetano Ruta had asked for a two-and-a-half year jail term. However, the two designers will have to pay 500,000 euros as a first instalment of a fine that could reach 10 million euros. The judge acquitted the pair of charges that they had filed inaccurate tax returns.
The success of Dolce and Gabbana's sexy corset dresses and sharply tailored suits favoured by celebrities such as Kylie Minogue, Kate Moss and Bryan Ferry have earned them a glamorous lifestyle.

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