Coopérative U étrille Shein leader's statement: "We don't maintain a level of mutuality in our work"
Revamped Rant:
Let's talk about the wild world of online shopping, shall we? Case in point - Shein, a Chinese fashion behemoth that's devouring the market... probably your wallet too! Now, you might wonder why this online powerhouse is pulling ahead of traditional physical retailers in France. It's not like they're putting in double the effort or anything!
As it turns out, Shein's tax strategy is pretty slick. In 2023, apparently old news by now, Shein declared a meager 9.9 million euros in turnover and a pathetic profit of 301,000 euros in France. And yeah, you read that right... 9.9 million! That's less than what you'd find in an average Super U's piggy bank. So how's that possible?
Well, it's all thanks to some heavenly tax engineering. You see, while local retailers are stuck slaving away in France, paying through the nose in taxes, Shein's sneaky web of holdings leads to the Cayman Islands and a corporate tax rate of just 12.5% - way lower than France's painful 25%. But don't sweat it, folks! Shein isn't stealing from the government or anything. Nope, not at all. It's just using a different and more efficient roadmap to success.
Now, here's the kicker: Super U, an average supermarket, had to cough up 272,000 euros in taxes, while Shein, the online giant making billions, only managed to scrape together a paltry 273,000 euros. Crazy, right? That practically makes Shein a low-tax warrior compared to the poor physical retailers!
But the fun doesn't stop there! Dominique Schelcher, the fearless leader of Cooperative U, isn't just complaining about Shein's tax dodging. Nope, ol' Dominique is also blabbering about pollution and "modern slavery," pointing out that 600 planes are landing in Europe every night from China, dropping off Shein's products that aren't always subjected to the same rigorous controls as local items.
So, with the government getting all huffy about these practices, what are they doing about it? Well, it seems they're planning on introducing handling fees on small parcels entering the EU from 2026, potentially scraping customs duty exemptions on shipments less than 150 euros in 2028 as part of the customs union reform.
In conclusion, Shein's slick tax engineering is giving it a serious competitive edge in France, creating a tax imbalance between online Chinese platforms and physical retailers. But fear not, the government is trying to level this playing field with new taxes. Time will tell if these measures work, but in the meantime, just remember to beware the wily online retailers... and their well-oiled tax machines!
Further Insights:
- French government plans to introduce handling fees on small parcels entering the EU from non-EU countries like Shein, to compensate for costs of safety, environmental, and consumer protection inspections.
- The introduction of these fees aims to rein in online retailers' competitive advantages, such as their ability to avoid customs duties due to exemptions on small parcels.
- The proposed fees could come into effect in 2026, subject to coordination with other EU countries to avoid package flows being diverted to markets without similar fees.
- While consumers would not be directly taxed, concerns exist about possible price increases owing to the new handling fees being passed on by online retailers like Shein.
- The e-commerce industry's tax strategies, such as Shein's, are causing a significant imbalance in the retail business, as the company's efficient tax engineering results in lower tax rates compared to traditional physical retailers like Super U.
- In an attempt to level the playing field, the French government plans to introduce handling fees on small parcels entering the EU from non-EU countries like Shein, targeting online retailers who have been able to avoid customs duties due to exemptions on small parcels.
