D&G: Fashion Designers Domenico Dolce And Stefano Gabbana Sentenced To Jail For Tax Evasion

An Italian court has sentenced fashion house duo Dolce & Gabbana to one year and eight months in prison for tax evasion of 200 million euros ($282 million). They were also ordered by the court in Milan to pay a fine of 500,000 euros to Italy’s national tax agency. Lawyers for Dolce and Gabbana, whose celebrity clients include Beyonce and Madonna, immediately said they will appeal, and under Italian law the sentence will be suspended in the meantime. Domenico Dolce and Stefano Gabbana were accused of having transferred control of their brands to a shell company in Luxembourg in 2004 and 2005 to avoid paying Italian taxes. Prosecutors had argued that setting up the Luxembourg company Gado – an acronym of the surnames of the two designers – while the company was operating out of Italy was a bid to defraud the state. They had called in May for the pair to be sent down for two years and six months. In her closing speech at the trial, prosecutor Laura Pedio said there was “rock-solid proof” that the duo had committed “sophisticated tax fraud”.