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Kering to Pay 187 Mln Euros to Settle Bottega Veneta Tax Dispute

The logo of Kering is seen during the company's 2015 annual results presentation in Paris, France, February 19, 2016. (Reuters)
The logo of Kering is seen during the company's 2015 annual results presentation in Paris, France, February 19, 2016. (Reuters)
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Kering to Pay 187 Mln Euros to Settle Bottega Veneta Tax Dispute

The logo of Kering is seen during the company's 2015 annual results presentation in Paris, France, February 19, 2016. (Reuters)
The logo of Kering is seen during the company's 2015 annual results presentation in Paris, France, February 19, 2016. (Reuters)

French luxury goods group Kering agreed to pay almost 187 million euros ($207 million) to settle a dispute with Italian tax authorities centered on its fashion brand Bottega Veneta, three sources with direct knowledge of the matter said on Friday.

Kering confirmed the outlines of the settlement, without giving the cost, saying it would have no impact on the group's results in 2022 or on its recurring tax rate in future years.

"In the spring of 2019, given the rapid changes in its business environment, its strong international growth and some uncertainties of Italian legislation, Bottega Veneta proactively made contact with the Italian Revenue Agency to discuss its tax position", Kering said in a statement adding this agreement was "the result of those discussions".

Earlier on Friday the Milan prosecutor referred in a press release to a tax investigation led by Milan tax police into a Swiss company, part of an international luxury goods group, which allegedly operated in Italy to produce and distribute an Italian brand, without specifically naming the company.

Revenue at the Italian leather goods house were booked through Kering's Swiss-based subsidiary Luxury Goods International and Italian prosecutors and tax authorities argued that the tax should therefore have been paid in Italy, not Switzerland, the sources said.

Luxury Goods International paid 186.8 million euros to settle the tax case, covering the fiscal years 2012 to 2019.

Separately, Milan prosecutors' criminal investigation for tax evasion is still ongoing, the sources said.

Three years ago, Kering reached an agreement with the Italian tax authorities, paying a record 1.25 billion euros to settle a similar dispute centered on its fashion brand Gucci.

Milan prosecutors in the past have probed US tech giants such as Apple, Amazon and Facebook over taxes, allowing Italy to net several billion euros in fines and tax payments.

In previous cases, once the agreement between the companies and the Italian tax agency was signed, prosecutors closed the criminal investigation with either a dismissal or a settlement.

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Fashion

80-year-old LL Bean Staple Finds New Audience as Trendy Bag

Gracie Wiener poses with some of her tote bags in Washington Square Park in New York, Wednesday, July 17, 2024, (AP Photo/Pamela Smith)
Gracie Wiener poses with some of her tote bags in Washington Square Park in New York, Wednesday, July 17, 2024, (AP Photo/Pamela Smith)
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80-year-old LL Bean Staple Finds New Audience as Trendy Bag

Gracie Wiener poses with some of her tote bags in Washington Square Park in New York, Wednesday, July 17, 2024, (AP Photo/Pamela Smith)
Gracie Wiener poses with some of her tote bags in Washington Square Park in New York, Wednesday, July 17, 2024, (AP Photo/Pamela Smith)

L.L. Bean created it 80 years ago to haul heavy blocks of ice. Now it's a must-have summer fashion accessory, The Associated Press reported.

The simple, sturdy canvas bag called the Boat and Tote is having an extended moment 80 years after its introduction, thanks to a social media trend in which they're monogrammed with ironic or flashy phrases.

New Yorker Gracie Wiener helped get it started by ordering her humble bags from L.L. Bean monogrammed with “Psycho” and then “Prada,” the pricey Italian luxury brand, instead of just her name or initials, and posting about them on Instagram. Then others began showcasing their own unique bags on TikTok.

Soon, it wasn’t enough to have a bag monogrammed with “Schlepper,” “HOT MESS,” “slayyyy” or “cool mom.” Customers began testing the limits of the human censors in L.L. Bean’s monogram department, which bans profanity “or other objectionable words or phrases,” with more provocative wording like “Bite me,” “Dum Blonde” and “Ambitchous.”

Social media fueled the surge, just as it did for Stanley’s tumblers and Trader Joe’s $2.99 canvas bags, which were once selling on eBay for $200, said Beth Goldstein, an analyst at Circana, which tracks consumer spending and trends.
The tote’s revival came at a time when price-conscious consumers were forgoing expensive handbags, sales of which have weakened, and L.L. Bean’s bag fit the bill as a functional item that’s trendy precisely because it’s not trendy, she said. L.L. Bean's regular bags top out at about $55, though some fancier versions cost upward of $100.
“There’s a trend toward the utilitarian, the simple things and more accessible price points,” she said, and the customization added to the appeal: “Status items don’t have to be designer price points.”

L.L. Bean’s tote was first advertised in a catalog as Bean’s Ice Carrier in 1944 during World War II, when ice chests were common. Then they disappeared before being reintroduced in 1965 as the Boat and Tote.

These days, they’re still made in Maine and are still capable of hauling 500 pounds of ice, but they are far more likely to carry laptops, headphones, groceries, books, beach gear, travel essentials and other common items.

Those snarky, pop-oriented phrases transformed them into a sassy essential and helped them spread beyond Maine, Massachusetts’ Cape Cod and other New England enclaves to places like Los Angeles and New York City, where fashionistas like Gwyneth Paltrow, Reese Witherspoon and Sarah Jessica Parker are toting them — but not necessarily brandished with ironic phrases.

“It’s just one of those things that makes people smile and makes people laugh, and it’s unexpected,” said Wiener, who got it all started with her @ironicboatandtote Instagram page, which she started as a fun side hustle from her job as social media manager for Air Mail, a digital publication launched by former Vanity Fair Editor-in-Chief Graydon Carter.

The folks at L.L. Bean were both stunned and pleased by the continuing growth. For the past two years, the Boat and Tote has been L.L. Bean’s No. 1 contributor to luring in new customers, and sales grew 64% from fiscal years 2021 to 2023, spokesperson Amanda Hannah said.

The surge in popularity is reminiscent of L.L. Bean’s traditional hunting shoe, the iconic staple for trudging through rain and muck, which enjoyed its own moment a few years back, driven by college students.