Vivienne Westwood has been accused of tax avoidance and finds herself in a bit of legal trouble. The designer has reportedly been paying an offshore Luxembourg company £2 million a year for the rights to use her name. Apparently, by relocating the rights away from the U.K., the designer may have circumvented paying U.K.’s government taxes every year, reducing her burden by about £500,000.
This is a big no-no, especially considering the principles of the Green Party, which Westwood herself supports. The designer allegedly donated £300,000 to the group, whose platform for governance is in opposition to these types of shady practices. In fact, the Green Party is hell-bent on making sure companies can no longer look to overseas locations in order to avoid paying taxes. According to The Telegraph, the group is championing a bill outlawing the practice.
Westwood’s people say the designer paid her share of taxes and that the Luxembourg holding company they’re paying, Latimo SA, is getting royalties due to a licensing agreement. “Vivienne Westwood Ltd and all the companies belonging to the group pay all the required taxes in all the countries in which they trade or operate, in accordance to audited financial statements. All British entities based in the UK paid the required taxes. Within the UK, Vivienne Westwood Limited paid £780,228 of taxes in 2013 and £1,250,858 of taxes in 2012.”
Allegedly, last year’s tax bill should have been at least £500,000 more. There have been a few design houses accused of tax avoidance recently, including Dolce & Gabbana (found innocent) and Prada, which is also under investigation. As they say, only death and taxes are certain in life and just as the grim reaper always catches up to you, so does the taxman.
[via The Telegraph]
