Dolce and Gabbana shut up shop in protest at tax evasion jail sentences

The three-day protest began on Saturday, with the shutters going down on the pair’s nine Milan shops, their Martini bar and Gold restaurant, with signs in the windows saying ‘Closed in indignation’, in both English and Italian.

It was in Milan that Domenico Dolce, 54, and Stefano Gabbana, 50, displayed their first collection in 1985.

But the pair were last month given 20-month jail terms by a court in that city for evading taxes on royalties of around £860 million by selling their brand to a Luxembourg-based holding company, in 2004.

Prosecutors said the sale of the brands to Gado, the holding company the pair set up, enabled them to avoid a high rate of tax in Italy and pay a lower rate in Luxembourg, thus defrauding the Italian state.

The pair run no risk of being placed behind bars until they have exhausted their right under the Italian justice system to at least two appeals against the conviction.
In a statement the Dolce and Gabbana said: “The closing of our shops in Milan is a symbol of our disdain.”

The statement, published in a number of newspapers on Saturday, they said: “We are no longer willing to suffer undeservedly the accusations of the financial police and the income revenue authority, attacks from public ministers and the media pillory we have already been subjected to for years.”
Attached to the statement is a table of the top financial contributors to the city of Milan for 2005, showing Dolce and Gabbana in fourth and fifth place respectively.

Dolce and Gabbana have denied any wrongdoing, saying the accusation against them was based on “a completely abstract calculation” of their companies’ market value, and are planning to appeal.
Following their conviction Milan’s city administration said Dolce and Gabbana would no longer be able to use any public spaces for their shows, suggesting they were bad for the city’s image.
Commercial director Franco D’Alfonso said: “Any time designers Dolce and Gabbana submit requests for public space, the council must keep the doors closed to them. Their fashion is seen as excellent the world over, but we do not need tax evaders to promote us.”
The designers, who count Kylie Minogue, Kate Moss, Keira Knightley and Daniel Craig among their celebrity fans, reacted furiously. In an angry tweet Stefano Gabbana wrote: ‘Milan council: You’re disgusting!!!’
The pair said they would continue to pay their more than 250 employees in Milan during the temporary closure of all their nine shops in the city.
In the statement they added: “Just considering our stores in Milan, we provide jobs for over 250 people who, in the following days, will be properly remunerated even if our stores will stay closed.
“Despite our passion and a sense of responsibility which push us to continue working with our usual dedication and drive, we are tired of being subjected to continuous slander and insults, which are detrimental to the serenity of our workplace and distracting us from our work as designers.
“We are very fortunate to work with people who are gifted with rare excellence, both from a technical-professional point of view and from a personal point of view; they believe in us and this situation is taking away their motivation.
When the charges were first made public, Stefano Gabbana condemned the Italian tax authorities as ‘thieves’, and threatened to leave the country.
The conviction follows an investigation which began in 2008 as part of a tax-avoidance crackdown, amid the eurozone crisis.
Tax evasion is thought to cost Italy £170 billion a year. Several cases involving celebrities have led to out-of-court settlements; in 2000 the opera singer Luciano Pavarotti paid £8m in back taxes, while MOTO GP champion Valentino Rossi agreed to hand over £33m in 2008.

Telegraph
Is Atlas Shrugging?