Dolce and Gabbana to go on trial for tax evasion
Domenico Dolce and Stefano Gabbana, founders of luxe Italian fashion house Dolce & Gabbana, will go on trial in December for tax evasion.
The pair are accused of carefully dodging taxes by selling their business in 2004 to a Luxembourg-based holding company, Gado Srl, that they actually created in order to evade higher corporate taxes in their home country of Italy, according to Women’s Wear Daily.
An investigation into the designers by Italian police began in 2008. Another probe was also launched into the company itself for alleged tax irregularities.
The design duo were ultimately charged with fudging their earnings statements and making off with about $540 million in extra income, but those charges were dropped last year when a judge decided there wasn’t enough evidence to prosecute the pair.
The prosecution appealed that decision to the Italian supreme court, which declared that evading taxes using tax havens was a “criminal offense under the law,” WWD reports.
Dolce and Gabbana are certainly not the first business people to wield creative accounting to avoid higher taxes.
Facebook co-founder Eduardo Saverin raised in a ruckus right before the social media giant went public this year by giving up his U.S. citizenship in favor of Singapore -- saving himself millions of taxes to Uncle Sam.
And Republican presidential candidate Mitt Romney has been hammered by Democrats during the election season for owning a Swiss bank account and investment funds located in the Cayman Islands, both popular locales for avoiding higher taxes.
Follow Shan Li on Twitter @ShanLi
The view from Sacramento
For reporting and exclusive analysis from bureau chief John Myers, get our California Politics newsletter.
You may occasionally receive promotional content from the Los Angeles Times.