Superdry CEO Julian Dunkerton has raised concerns over fashion giant Shein’s tax practices.
- Dunkerton argues that Shein benefits from a tax advantage due to no import duties on low-value parcels.
- Shein has attributed its success to an efficient supply chain, dismissing tax concerns.
- The UK Treasury highlights the need for a balance in tax policies for retailers and consumers.
- UK business secretary expects ethical commitments from Shein for a potential London IPO.
Julian Dunkerton, CEO of Superdry, has publicly criticized the tax advantages enjoyed by fast-fashion retailer Shein, suggesting that the company is benefiting from an unfair fiscal loophole. The loophole allows shipments valued under £135, which are sent directly to UK customers, to avoid import duties. Dunkerton claims this situation offers Shein an undue competitive edge over other companies that must pay full import taxes on larger batches of goods.
While Shein has previously insisted that its success is primarily due to an efficient supply chain rather than any tax-related strategies, it declined to comment further on the issue. The debate centers around whether the lack of import duty on low-value parcels permits a form of tax avoidance, as asserted by Dunkerton, who contends that “the rules weren’t made for a company sending individual parcels and having a billion-pound turnover in the UK without paying any tax.”
This situation has attracted the attention of the UK government, where the Treasury department acknowledges the complexity of creating tax policies that equitably address the interests of both retailers and consumers. Meanwhile, UK Business Secretary Jonathan Reynolds has expressed his concerns regarding the tax practices associated with Shein, particularly in light of the company’s potential interest in a London IPO. Reynolds indicated that any move towards listing in London would require Shein to adhere to ethical and moral business standards across all aspects of their operations.
The ongoing debate highlights the tensions between maintaining competitive business environments and ensuring fair taxation.
