Italian motorcycling ace Valentino Rossi on Tuesday closed his tussle with Italian tax authorities with an agreement to pay some 35 million euros in back taxes for the 2001-2006 period.
Rossi, who has won the premier Grand Prix class five times, will pay about 19 million euros for the 2001-04 period, compared to the 112 million the tax office originally sought, while the exact amount for the 2005 and 2006 period must still be calculated.
''I'm very glad about the way this difficult situation worked out, because I'm sure I will now be more relaxed and able to focus on my job,'' Rossi said in a statement released on Tuesday.
''For a number of reasons I already decided to return to live in Italy. London is a very interesting city but spending more time with my family and friends was becoming a growing need given that my commitments keep me away from home for more than half the year,'' he added.
''I could not come back and have problems with Italian tax authorities, nor could I engage in a long, drawn-out court battle. This accord with the tax office will allow me to start the new seasons prepared and at peace,'' Rossi said.
The tax office confirmed last week that its officials would meet Rossi and his advisors here in the rider's home Pesaro on Tuesday to tie up the final details of the accord.
''I know that Valentino wants to get to the start of the new championship on March 8 with all these issues resolved,'' the seven times world champion's father Graziano said last week.
Rossi, who turns 29 later this month, was placed under investigation last August over possible undeclared earnings of 60 million euros for the period 2000-2004.
The tax office investigation is linked to Rossi's decision to take up British residency in 2000.
Rossi's London residency has enabled him to take advantage of favourable tax conditions, such as only declaring earnings made in Britain and avoiding taxes on his lucrative merchandising and sponsorship contracts, according to the Italian taxman.
Rossi has always denied any willful wrongdoing and claims that he was caught in the middle of a legal dispute between Britain and Italy.
According to Italy's Junior Economy Minister Vincenzo Visco, who spearheaded a government crackdown on tax evasion, British tax rules create a legal loophole and he has promised to challenge them through the European Union.
Rossi was probed for suspected tax evasion in 2002 but no evidence of wrongdoing was found and the case was shelved.
He is one of the world's highest paid sportsmen. Last year, he was reported to have earned 12 million euros from his Yamaha contract and 25 million from sponsorship and merchandising deals.
Rossi's tax problems were seen by many observers as one of the reasons why the Yamaha rider had his worst season ever last year.
He placed third in the riders' standings and won only four races. This was the second year in a row he missed the title after wining five consecutive championships in motocycling's premier class from 2001 to 2005.
Rossi also won the 125cc and 250cc titles before moving up to the premier Grand Prix class.
