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Dolce & Gabbana convicted for tax evasion

Fashion designers Domenico Dolce and Stefano Gabbana were sentenced last Wednesday to one year and 8 months jail time - suspended - for tax evasion.

The Italian tax man has been on the case of Dolce & Gabbana for years, and the two designers were handed the sentence because they had set up a holding company Gado in Luxembourg in 2004, in order to sell their brand to the holding company, but according to the prosecution it was a ploy to avoid declaring taxes on about 1 billion euros.

A Milan court found the pair guilty and ordered them to pay 500,000 euros to the tax authorities as a first instalment of the fine, that could reach up to 10 million euros, but their lawyers are appealing.

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In 2010, the two designers had already indicted for tax evasion, but the charges were dropped, but the case was then re-opened and the trial began in early this year.

Tax evasion is pandemic in Italy. It has been estimated that the phenomenon is worth some 120 billion euros a year and each government that goes into power pledges to stamp it out, and try to recoup the money for the country's crying coffers.

Tax authorities have hunted down celebrities and sports personalities, splashing them all over the front pages of newspapers in hopes of convincing citizens into ponying up undeclared funds.

The authorities have even gone as far as invading high profile tourist towns in order to catch tax dodgers.

Dolce & Gabbana are just the latest celebrities caught in the net.

Oscar winning actress Sophia Loren spent 18 days in jail for tax evasion back in 1982.

Famous composer and Oscar nominee Ennio Morricone settled with the Italian tax man after they contested his domicile in the Principality of Monaco to avoid paying taxes, and late opera singer Luciano Pavarotti also got caught up in the same web and also settled.

Nine-time MotoGP world champion Valentino Rossi was accused of tax evasion and he settled with the tax man for 35 million euros after he was accused of taking advantage of the UK’s non-domiciled resident status, while his financial interests were mainly in Italy.

World Superbike star Marco Melandri was also found guilty and he received a suspended sentence, and ordered to pay a few million euros in back taxes.

Italy’s former PM Silvio Berlusconi who once said he understands why people dodge taxes, was recently sentenced to four years in prison for tax evasion, but he is appealing, and legendary porn star Rocco Siffredi was also accused, but the tax man had to pull out on that case, because his lawyers proved him innocent.

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