A few days ago, news emerged from the USA regarding the arrest of Frank Butselaar – a tax adviser to the rich and famous, including at least two DJs. He was detained at his holiday home in the picturesque commune of Valfabbrica – and is now likely to spend the next few months in a New York prison.
American authorities told an Italian court that they believe Butselaar is responsible for “developing sophisticated international tax evasion schemes for high net worth clients with worldwide income.”. He is alleged to have built illegal tax shelters in Cyprus for models, artists and DJs – and is said to have deprived the USA of around $100million worth of taxes.
How this episode ultimately plays out, of course, remains to be seen. For Butselaar, his future could involve serving over five years in prison if convicted of the most serious charges against him. But Ears To The House can’t help but wonder if there are now DJs who are suddenly asking a lot of questions about their own tax affairs.
Now, we know that DJs trying to reduce their tax liabilities is not a remotely new thing. Many DJs were paid cash in hand during the 90s precisely for this reason. It led to situations where investigators probing DJs tax affairs would often have to dig through old copies of Mixmag to find evidence of listings and appearances.
These days, the five and six-figure fees being commanded by higher echelon DJs mean different methods have to be utilised – hence why they now go to the same tax advisors that celebrities were using for decades beforehand. So when an arrest like this happens, questions could inevitably follow elsewhere – fairly or not.
We reached out to The Insider – a man with decades of experience in the music business, who speaks to us strictly on condition of anonymity – to see what he thought. Were higher echelon DJs really going to be spending the weekend wondering about their tax arrangements?
He said “Some will worry, some won’t be worried, and a few probably should be. Most of these DJs are happy to farm out this stuff to advisers. Their taxes can be complicated to work out, often because business and personal lines are blurred in their world. It’s not entirely unheard of for DJs to pretend they’re on holiday when they’re actually working to. It’s all about reducing taxes.”
“In a way, I don’t blame them. Nobody wants to pay more tax than they have to, but there are a lot of legal ways to reduce their obligations. Jeff Mills, DJ Sneak, and John Summit are just a few who moved to Florida to avoid paying income tax, for example. Some also invest their money in companies, which often reduces how much tax they will pay.”
“That said, there are some DJs who are signed up with some, shall we say, more aggressive tax advisers. They might well be hoping their adviser of choice hasn’t done anything that could bring attention to their tax affairs.”.
Thoughts and prayers go to the advisers who’ll arrive at their offices tomorrow morning, only to be greeted with inboxes full of DJs suddenly curious about their taxes…
