Prosecutors launch tax inquiry against Berlusconi

Italian prosecutors have launched an investigation against Prime Minister Silvio Berlusconi for tax evasion linked to his Mediaset media empire.

Last Updated: Oct 15, 2010, 21:41 PM IST

Rome: Italian prosecutors have launched an investigation against Prime Minister Silvio Berlusconi for tax evasion linked to his Mediaset media empire, judicial sources said on Friday.

The allegations, which were immediately rejected by Mediaset, are linked to tax declarations for 2003 and 2004 and are part of a wider inquiry. Berlusconi`s son Piersilvio, deputy chairman of Mediaset, and other senior managers have also been placed under investigation, the sources said. Mediaset was founded by Berlusconi in the 1970s and includes Italy`s three main privately-owned national television channels.
The accusation is that Mediaset artificially inflated the price of film rights sold to companies that belonged to him and then sold back to Mediaset, allowing the company to reduce its revenues and pay less tax. The charge is punishable by between 18 months and six years in prison. Mediaset said that the film rights were bought at market prices, adding: "All the accounts and tax declarations of the company were compiled with the most rigorous observance of transparency criteria and legal norms."

The company also referred to the "absurdity" of the accusations. Mediaset chairman Fedele Confalonieri, one of Berlusconi`s closest allies, was quoted by Mediaset`s news division as saying: "Every now and then we are put under investigation, we get dragged into things as usual."

Daniele Capezzone, a spokesman for Berlusconi`s People of Freedom ruling party, said the prime minister "is the object of a massive, systematic and unending series of attacks, inquiries and judicial proceedings."

The Mediaset trial in Milan has been put on hold awaiting a ruling by the Constitutional Court expected in December on a law that grants Berlusconi and his ministers temporary legal immunity for a maximum of 18 months.

Antonio Di Pietro, a former crusading anti-corruption judge who now leads the Italy of Values party and is one of the PM`s fiercest critics, said: "Berlusconi is constantly under investigation because he never goes on trial."

Berlusconi`s battles with the law have marked his public life since he burst onto the political scene in the mid-1990s. A self-made billionaire, Berlusconi has faced charges including corruption, tax fraud, false accounting and illegally financing political parties.
Although some initial judgments have gone against him he has never been definitively convicted.

Bureau Report