Shein’s Fast Fashion Losing Ground in South Africa as New Import Taxes Take a Toll

The days of ordering ultra-cheap fashion from Chinese ecommerce giant Shein may be numbered in South Africa. According to new data from Cape Town-based firm Slant, Shein’s market share has steadily declined over the past three years — a trend that sharply accelerated following the South African Revenue Service’s (SARS) 2024 import tax crackdown.

Slant’s report shows that Shein lost significant ground during the 2024 Black Friday period, dropping from 14% of apparel retail share in 2023 to just over 10% in 2024. By early 2025, the company’s total retail market share had dipped below 3%, down from 4% in early 2024.

What’s Causing the Drop?

The decline comes as SARS rolled out strict new tax rules in September 2024 aimed at curbing the dominance of foreign ecommerce retailers like Shein and Temu, and boosting local fashion retailers such as Woolworths and The Foschini Group.

Previously, Shein orders under R500 benefited from tax loopholes, allowing the company to offer rock-bottom prices. But under the new rules:

• All imports are now taxed, regardless of value.

• General goods attract a 20% import duty.

• Clothing items are subject to a steep 45% VAT markup.

The timing of the policy change had immediate impact. Slant’s retail market graph shows Shein’s sales growth stalling around October 2024, just as the new taxes came into effect — right before the critical Black Friday shopping season.

“It’s clear that Shein did not achieve the same level of market share at the end of 2024 as it did in 2023,” Slant’s analysts noted. “Progress in the first 10 weeks of 2025 lags even further behind.”

Temu Rises While Shein Stalls

While Shein stumbles, Temu — another Chinese ecommerce player — is on the rise. Unlike Shein, Temu’s offerings go beyond fashion, focusing on general, low-cost household goods, which are subject to lower duties than clothing.

A News24 survey showed that one in three South Africans used Temu in 2024, with many shopping at least once a month. For now, the 20% import duty on Temu’s general goods seems less disruptive than the 45% Shein faces on clothing.

Consumer Backlash and Petition

While local retailers are breathing a sigh of relief, many South African shoppers are not. Over 24,500 people signed a petition urging SARS to reverse the clothing tax hikes. Their argument? Local fashion is just too expensive.

“South Africans cannot afford this,” the petition reads. “We buy from Shein and Temu because we cannot afford clothes from local businesses.”

The petition calls for SARS to consider alternative revenue measures that are fairer to working-class consumers, many of whom turned to Shein during tough economic times.

A Win for Local Retailers?

The new rules have eased pressure on local fashion brands, some of which suffered under Shein’s entry into the market. Woolworths noted in its 2024 financial report that international online retailers disrupted its clothing division, though this disruption now seems to be softening.

It remains to be seen whether Temu’s more diversified model will also face a sharper slowdown under the new duties. But for now, the impact on Shein is undeniable.

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