Customs officials in Hangzhou, China, announced they arrested eight suspects for evading taxes on the importation of international luxury brands into the Chinese mainland.

Officials said the suspects smuggled and sold 24,000 garments covering approximately 70 international brands, including Louis Vuitton, Prada, Dolce & Gabbana  and Gucci.

During a routine inspection by customs officials in November 2008, it was discovered that some local shops sold genuine luxury clothing 20% to 25% cheaper than franchise stores.

According to China Daily, the suspects would buy luxury products from 10 suppliers in Hong Kong and transport the clothes into the Chinese mainland via Shenzhen, which borders Hong Kong.

China imposes tariffs on imported clothing of 10% to 16%, along with a value added tax of an additional 17%.

(Posted 26 April 2010)