Superdry founder urges government to act as he says Shein can “dodge tax”

Superdry co-founder and CEO Julian Dunkerton wants the government to take action over a situation he says allows fast fashion e-tailer Shein to “dodge tax”.

In an interview with the BBC Today Programme on Radio 4 he said the fact that import duties aren’t charged on the low-value parcels it sends direct to customers from abroad gives Shein an unfair advantage against UK-based firms. Shipments with a value below £135 sent directly to UK shoppers have no import duties.

The issue has been raised before but Shein has always said its efficient supply chain rather than tax advantages are what have driven its growth. Meanwhile the UK authorities have pointed out their balancing act between policies that boost UK retailers and those that offer consumers lower prices.

But Dunkerton believes that the rise of e-tail giants like Shein means the situation has changed since the £135 rule was first brought in. The lack of import duties used to have little impact on UK (and EU) tax revenues but the massive volume of parcels now being imported has changed that.

Dunkerton said: “The rules weren’t made for a company sending individual parcels [and] having a billion-pound turnover in the UK without paying any tax. We’re allowing somebody to come in and be a tax avoider, essentially.”

The authorities in the US and the EU are already looking at the issue around DTC companies and tax revenues. 

The CEO also highlighted the company’s eco impact, calling it a “complete environmental disaster”, and recommended applying an environmental tax to companies such as Shein whose low prices and social media marketing strategy are said to encourage a wear-infrequently-and-throw-away approach.