Temu EU profits more than double as low prices draw customers

The latest accounts for Temu’s Ireland-based EU parent, Whaleco Technology, revealed that revenues also almost doubled to $1.7bn in the year to December 2024, The Guardian reported.

The retailer, which employs just eight people at its EU arm, paid only $18m in corporation tax, approximately $3m of which was a mandatory top-up after the EU signed up to a global minimum rate for big companies.

Other documentaton showed that Temu now has approximately 115 million customers across the EU, amounting to about a quarter of the bloc’s population.

The performance pre-dated plans by the EU to close the tax loophole enabling packages worth less than €150 (£130.70) to avoid customs duty. That is expected to change from 2028 and tightening is already under way. The US has already ended its similar de minimis rules and the UK is reviewing its stance.

Last year, 4.6 billion low-value parcels entered the EU. The vast majority came from China, where Temu and counterpart Shein manufacture and dispatch much of their product.

Fair Tax Foundation chief executive Paul Monaghan said: “The UK and other European governments need to move much more quickly to not only protect their tax base, but allow existing retailers to compete on a level playing field with these Chinese ecommerce giants that have overseas tax avoidance hard-wired into their structures.

A Temu spokesperson said: “Temu categorically rejects any suggestion that our structure or operations are designed to avoid taxes or minimise our economic footprint in Europe. Despite being a young and fast-growing company still in the investment phase, we have already paid billions of euros in taxes across European jurisdictions, and that figure will continue to rise as our operations mature.

“The tax figure cited refers only to the tax paid by a single legal entity and does not include customs duties, VAT, and other taxes.

“Temu entered the European market just two years ago and has invested heavily in building its platform to connect sellers and consumers more efficiently, passing those efficiencies back to consumers in the form of lower prices on quality goods. At the same time, we have been creating new growth opportunities for local sellers across Europe.

“Our focus is on the long term: building a sustainable, compliant, and trusted platform that helps consumers access quality products at affordable prices.”