MILAN — The Giorgio Armani Group has agreed to pay a total of 270 million euros, or $373 million at current exchange, to Italy’s internal revenue service, the Agenzia delle Entrate, a company spokesman confirmed.
News of the settlement was first reported in Italian newspaper Il Sole 24 Ore. It said the agency’s audit concerned the operations of three foreign companies directly controlled by Giorgio Armani in the 2002 to 2009 period. Although the Giorgio Armani Group brought back the tax residency of the aforementioned companies in Italy in 2009, the revenue office claimed that the group should have paid the income taxes in Italy.
Among the companies investigated was GA Modefine SA, a subsidiary located in Switzerland, which was handling the international distribution of the group’s products. In keeping with the group’s restructuring plan, aimed at concentrating strategic activities in Italy, in 2009 Giorgio Armani officially closed GA Modefine and moved its functions to the group’s Italian headquarters.
Giorgio Armani is the latest Italian fashion company to settle with the Italian Revenue Agency. Recently, Bulgari, Prada, Safilo, Marzotto and Luxottica all opted for a settlement to avoid going to trial.
“Twenty years ago, it was extremely common for Italian fashion groups to create subsidiaries abroad for a more favorable tax rate,” said a legal source, who pointed out that the Italian law allows these practices only if the companies can demonstrate that the subsidiaries are not only operative, but also feature an autonomous strategic management and an effective board of directors. “In the last five years, the tax agency has tightened the belt, and fashion companies are reorganizing to avoid any agency’s audit, which can seriously damage their image,” he added, referring to the numerous settlements made by Italian fashion firms.
Armani has settled tax disputes with the Italian authorities in the past. The designer made two settlements in 1996 because he admitted to having paid bribes to Italian tax police. This resulted from a major probe into the Guardia di Finanza, Italy’s fiscal police, part of the Clean Hands action.
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)
@heriethpaul and @gracebol have a moment on the @victoriassecret fashion show 2017. See every look from the runway on WWD.com. Link in bio. (📷: @giovanni_giannoni_photo) #wwdfashion #victoriassecret #VSFashionShow
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia