New UK Business Secretary Concerned About Sheen Tax Loophole | kbnmart

Britain’s new business secretary said Shein’s planned IPO on the London Stock Exchange would lead to a potential investigation into its tax arrangements and questions about its supply chain.

There had already been speculation that this would be the case, but Jonathan Reynolds saying this while he was actually in government (rather than as business secretary before the general election) confirms that the new administration is taking the issue seriously.

Reynolds expressed his concerns, saying the fast-fashion retailer would be expected to meet “ethical and moral objectives” in “all aspects of the business” if it listed in London.

Reynolds said he was “concerned” about a “loophole” allowing businesses to avoid customs duties by shipping small parcels directly to customers, adding that he “expects every business in the UK to pay its fair share of tax”.

He also said he would like to discuss the matter with Sheen if it were considering doing more business in the UK.

Asked if he would welcome a London listing of Sheen, Reynolds said: Radio Times“I would like to do that, because wherever there is a company active in the UK, our ambition should be to regulate that company from the UK.

“That way we make sure that there are no things happening in terms of labor practices, tax practices or environmental matters that we are not happy with.”

After questions were raised about allegations that Shein used forced Uighur labour in the production of some of its clothing, Reynolds also said: “To be absolutely clear, if any company has forced labour in its supply chain they should not be doing business in the UK at all, and there should be no question about where they are listed.”

“But wherever companies are active (here), the best way to ensure that they meet the standards we want to see is for them to be regulated from the UK, and so if they are to be listed, I would like that listing to be here in the UK.”

He stressed the integrity of the London Stock Exchange and said: “Any company listed on the stock exchange in this country must adhere to very high standards in terms of disclosure of its business practices.”

In May, Sheen said it was investing tens of millions of dollars to “strengthen governance and compliance across our supply chain, as well as enable our suppliers to build more successful and responsible businesses.”