Fashion News

D&G TAX EVASION CHARGES

 
Several of fashion’s biggest names have been charged with tax evasion in the past few years. The regional tax office in Lazio, Italy hit Valentino and his business partner, Giancarlo Giammetti with a $39 million fine for allegedly evading tax payments. Gianfranco Ferré, Santo Versace, Mariuccia Mandelli of Krizia and their business associates were indicted in July 1995 on charges of corruption and bribing tax police in return for audit leniency, though a court later found that they were victims of extortion. Giorgio Armani, Gerolamo Etro and Aldo Pinto of Krizia faced similar charges and they too claimed that they were victim of extortion, but opted for plea bargains, while Roberto Cavalli was recently cleared of charges stemming from a 2002 investigation.
 
Now comes the news that Domenico Dolce and Stefano Gabbana could be personally liable for more than a billion dollars in unpaid taxes and fines, following a criminal tax investigation the Italian authorities opened in 2008.
 
 
The designer duo strongly denies the charges which are said to relate to the 2004 sale of the Dolce & Gabbana and D&G brands to the designers’ holding company, Gado Srl.
 
In a personal statement, the designers exclaimed: “It’s a paradox! Since when does one have to pay taxes on money one never actually collected? It’s an absurd demand based on a completely abstract calculation. This higher taxable sum is a virtual figure we have never received, the result of a theoretical accounting exercise.” 
 
The charges are being blamed on misguided police calculations that value the brands at $1.37 billion in 2004, to which the designers respond, “We wish!”