May 11, 2019

Anna Murray 

The global luxury group Kering manages renowned fashion brands, including Gucci, Pomellato, Alexander McQueen, Bottega Veneta, Balenciaga, Brioni, Boucheron, Dodo, Girard-Perregaux, Qeelin, Saint Laurent, Ulysse Nardin. And Kering Eyewear said on May 10 the group had agreed to pay 1.25 billion euros (US$1.40 billion), the highest ever, to settle a dispute with Italian tax authorities targeted on Gucci.
 
Kering’s deal follows a series of declines on Italy’s fashion industry in recent years, including on luxury Giorgio Armani and jewelry Bulgari, after a prolonged recession where some of the Italian more prosperous sectors came under scrutiny from tax authorities.
 

Gucci offices in Milan and Florence were raided by Italian police in late 2017. Gucci was alleged by the Italian Revenue Agency on tax evasion of more than 1 billion euros in revenues during the 2011-2017 periods. By agreeing on the settlement, Kering said in its statement that due to the fine involving 897 million euros in back taxes with the rest made up of interest payments and penalties, they would face an additional tax charge of 600 million euros in its 2019 financial accounts.
 
Gucci Chief Executive Marco Bizzarri and former CEO Patrizio Di Marco still remain under investigation in the case, “in their capacity as legal representatives of the company”, but Kering added that it was “confident that the situation regarding the criminal investigation will be clarified.”

Photo:Webshot.