Domenico Dolce and Stefano Gabbana may still face charges for alleged tax evasion even though charges were initially dropped in April.
Italy’s equivalent of the Supreme Court overruled the decision of Judge Simone Luerti yesterday (23.11.11), which had originally ruled there was no foundation for a trial in relation to the sum of over $1.1 billion in allegedly avoided tax, according to WWD.
Milan-based prosecutor Laura Pedio launched the appeal to the court, which decided there will be a new preliminary hearing in front of a different judge.
The accusations had been made against Dolce, Gabbana and five other defendants, including Dolce’s brother and board member Alfonso Dolce, and managing director and board member Cristiana Ruella.
The initial investigation by Italian authorities was based on the alleged failure of the pair to declare revenues of approximately $1.1 billion and claims that Luxembourg-based holding company, Gado Srl is a legal entity set up to avoid higher tax rates in Italy.
Addressing the allegations previously, Dolce and Gabbana said: “It’s an absurd demand based on a completely abstract calculation.
“We will tell the 3,800 employees of the companies, which compose the group, that we have paid all that was due and that we will strenuously defend ourselves to avoid being unjustly forced to pay for something that never existed in the first place.
“This higher taxable sum is a virtual figure we have never received, the result of a theoretical accounting exercise.”