The Bulgari Group have come to a settlement with Italy’s Inland Revenue to pay 42 million euro. The company say that the settlement will help “avoid a lengthy and costly confrontation over an issue whose interpretation is objectively uncertain,” according to WWD.
Authorities believed that Bulgari evaded tax payments of around 3 billion euros, starting from the year 2006, through a system of allegedly fictitious companies in the Netherlands and Ireland, countries with historically low corporate tax thresholds. The focus of the investigation was on Paulo and Nicola Bulgari, the grandsons of the founder of the jeweller, which is now owned by LVMH, and Francesa Trapani, the chairman of LVMH watches and jewellery. Trapani and the Bulgari brothers are still awaiting a criminal trial over the alleged tax evasion and the settlement will not negate any criminal liability on their part.
The Italian authorities have been clamping down hard on tax evasion since Berlusconi left power in 2011. It’s only weeks since we reported that Prada was being investigated for tax evasion, again, as a result of transferring business to holding companies abroad to avoid paying Italian taxes.In January 2013 members of the Burani handbag dynasty were jailed by a Milanese Court for the fraudulent bankruptcy of the Mariella Burani Fashion label and, of course, Domenico Dolce and Stefano Gabbana were each sentenced to one year and eight months in prison after being found guilty of tax evasion in June last year. The courts found that their sale of the Dolce & Gabanna and D&G brands in 2004 to a Luxembourg-based holding company, Gado Srl, was to evade higher corporate taxes in their home country of Italy.
Stay tuned to Wigs And Gowns for updates on the Bulgari brothers’ criminal trial!