The founder and CEO of UK clothing chain Superdry, Julian Dunkerton, has called on the government to take action against Chinese fast fashion giant Shein, accusing the company of “dodging tax”. Dunkerton claims that Shein has an unfair advantage over rivals because import duties are not charged on low-value parcels sent directly to customers from overseas. The Treasury said tax policies are designed to balance the interests of consumers and retailers. Shein has declined to comment. The value of UK direct-to-consumer online sales is expected to reach £130bn in 2025, up from £62bn in 2019.
Shein relocated its operations from China to Singapore and is said to be considering a London stock exchange listing later this year. The listing could prompt closer scrutiny of the brand’s practices. Dunkerton has criticised Shein as “a complete environmental disaster” and called for it to pay import duty, VAT and possibly an environmental tax. Shein has previously called itself “efficient” and has argued that its sales success is due to affordable fashion pieces that are produced quickly in small batches re-ordered based on customer demand.
Shipments worth less than £135, which are sent directly to UK shoppers, do not face import duties, but larger companies must pay. This has allowed Shein to undercut its rivals significantly. In addition to avoiding taxes, Shein has been criticised for promoting fast fashion with its low prices, “gamified” social media marketing, and support for single-use purchases. However, the business claims that its strategy aims to limit waste. Shein has also been accused of using forced labour in its supply chain, which it denies.
Dunkerton has been critical of Shein’s impact on the environment and the tax it avoids paying. He has called on the government to bring the brand and similar companies into the net so that they must pay tax. Alternatively, UK retailers may continue to lose out and the state’s potential tax take from the fashion industry may be further diminished
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