Business

Dolce and Gabbana sentenced to jail for tax evasion

  • 19 June 2013
  • From the section Business
Italian fashion designers Domenico Dolce (r) and Stefano Gabbana in a 2011 file image
The designers denied all the charges against them

Italian fashion designers Domenico Dolce and Stefano Gabbana have been sentenced to jail in Italy for one year and eight months for tax evasion.

They were accused of hiding millions of euros from Italian tax authorities.

The pair, whose customers have included Madonna, Kate Moss and Kylie Minogue, were not at the trial, deny the charges and have appealed.

Dolce and Gabbana have not commented on their sentences, which have been suspended pending their appeal.

The investigation by the Italian authorities began around six years ago as part of a government plan to crack down on tax avoidance.

At the hearing on Wednesday, the judge ruled that the designers moved their brand to a Luxembourg-based holding company Gado - a play on their two surnames - in 2004.

He said they had done this to avoid declaring taxes on royalties of around 1 billion euros (£833m; $1.3bn).

Prosecutors alleged they sold the business for well below actual market value.

They were initially cleared of the charges at a previous trial in April 2011 but Italy's highest court overturned that ruling, ordering that the case should be sent back.

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