Crime and punishment
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A Milan tax court ruled in favor of Italy's tax authority, Agenzia delle Entrate, and found Domenico Dolce and Stefano Gabbana guilty of tax evasion. The pair appealed the decision a lower court reached last year, but the higher court didn't rule in their favor, either.
Dolce and Gabbana had been suspected of tax evasion for nearly 10 years and were charged with using a Luxembourg-based holding company, Gado, to avoid paying taxes on royalties of $1.38 billion, reports Reuters.
Both the designers, as well as their accountant Luciano Patelli, were sentenced to 18 months of jail time — the sentence was reduced from 20 months thanks to the statute of limitations on facts in the case. But luckily for them, Italy has a minimum two-year sentencing for jail time, so Dolce and Gabbana will likely serve their sentence through house arrest and community service rather than in jail cells.
The designers' lawyer says they plan to appeal the case again, though at this point it seems wiser for them to quit while they're behind.