Domenico Dolce on the right and Stefano Gabbana on the
left actress Monica Bellucci pose for photographers during the opening
of a new Dolce&Gabbana shop in Moscow last month.
Reuters
MILAN—A Milan court Wednesday upheld a tax evasion conviction of designers
Domenico Dolce
and
Stefano Gabbana
and sentenced the pair to 18 months in prison.
The two Italian fashion designers, known for their sexy style favored by celebrities such as
Madonna
and
Naomi Campbell,
were convicted last June and each sentenced to one year and eight
months in prison for failing to file tax declarations for a
Luxembourg-based company called Gado.
Prosecutors
said Gado was created with the purpose of evading tax in Italy. The
total tax that Messrs. Dolce and Gabbana allegedly failed to pay is
about €40 million ($55 million) for 2004 and 2005. The pair appealed.
In
March, the prosecutor handling the appeal
Gaetano Santamaria
took the unusual step of arguing before an appeals court that the
allegations were groundless because Gado was a real operating company
rather than a shell company created to avoid paying tax in Italy.
But
on Wednesday, judges upheld the conviction. They did, however, cut the
jail sentence to 18 months. The judges weren't immediately available for
comment.
Massimo Dinoia,
a lawyer for Messrs. Dolce and Gabbana, said the pair were
"shocked" by the ruling. The two designers have denied the charges
throughout the process and Mr. Dinoia said they plan to appeal. It could
take months to hear the appeal.
"I'm speechless," said Mr. Dinoia. "The prosecutor himself asked for them to be cleared."
The
tax arrangements of Italian fashion companies have drawn scrutiny over
the years, particularly more recently as Italian authorities have taken a
hard look at structures such as offshore companies. For many years,
Italian companies established offshore subsidiaries, particularly in
Luxembourg, to evade or avoid taxes, say tax authorities.
For
instance, in December, the luxury giant Prada avoided any potential tax
avoidance charges in relation to its Luxembourg subsidiaries by
voluntarily deciding to bring them back to Italy. The company also
agreed to pay the tax amount that would have been charged if such
subsidiaries were in Italy in the last 10 years. The company, which
stressed that the decision had no financial impact on Prada, said that
it followed "close cooperation" with the Italian tax authority, started
in 2008, and "involved seeking a ruling on international transfer
pricing standards" for transactions between the company's subsidiaries.
Fly GossipGuy
THE SHADE IS REAL
As
far as Kenya goes, I don’t even have to hip y’all to some of my private
conversations for you to be able to deduce that no one on the cast is
featuring her. However, don’t expect her to be going anywhere. Like it
or not, people can draw the direct correlation between how successful
these last two seasons of Atlanta Housewives has been and Kenya More. I
personally don’t think their is a direct correlation between Kenya and
the ratings. I truly feel it is mere coincidence. I feel the show would
have done the numbers with or with her. LOL – I JUST DON’T SEE IT FOR
KENYA MOORE AT ALL.
