By Brazil Stock Guide — Shein, the China-founded fashion retailer, has widened its price advantage over Brazil’s leading apparel chains, with a comparable basket of products priced 44% below the average of Renner, C&A and Riachuelo in August, up from a 34% gap in June, according to a BTG Pactual study.
The widening gap comes as Brazil debates the future of the so-called “blusinhas tax” — a colloquial name for the federal import duty on low-value cross-border purchases, particularly those made through Asian e-commerce platforms.
The levy had imposed a 20% federal import tax on purchases of up to $50 made by individuals through platforms enrolled in Brazil’s Remessa Conforme program.
The tax is currently set at zero under a provisional measure issued in May. The measure must be approved by Congress by September 8 or it will expire.
The issue is also part of ongoing negotiations between President Luiz Inácio Lula da Silva’s administration and congressional leaders. Lula is expected to meet on Wednesday, August 26, with Lower House Speaker Hugo Motta and Senate President Davi Alcolumbre as the government seeks to secure approval of the measure that eliminated the federal tax on those purchases.
The price advantage is widening
In BTG’s survey, Shein’s comparable basket fell to R$756 in August from R$939 in June. The average basket across the three Brazilian retailers declined to R$1,344 from R$1,427. As a result, Shein’s price advantage widened by 10 percentage points in just two months.
“The cleanest read is that Shein’s price advantage widened,” wrote analysts Luiz Guanais, Yan Cesquim and Beatriz Cendon, who authored the report.
BTG launched its Apparel Price Index in June to track pricing dynamics across Brazil’s clothing retail market as competition from international platforms intensifies.
To make prices comparable, the bank selects 11 product categories available across all four retailers and calculates the median price within each category. Those figures are then added together to create a comparable basket, with each category carrying the same weight.
According to BTG, the methodology helps reduce distortions caused by differences in product mix and assortment across retailers.
Among the Brazilian companies, C&A now has the most expensive basket, at R$1,440, followed by Renner at R$1,327 and Riachuelo at R$1,266.
Since June, Shein’s basket price has fallen 20%. Riachuelo’s dropped 18%, Renner’s declined 4%, while C&A’s rose 6%.
Part of Shein’s decline reflects a more aggressive promotional strategy. In August, 86% of the platform’s products were on sale, up from 79% in June, while the median discount widened to 35% from 30%.
BTG, however, said the move does not appear to be merely the result of end-of-winter clearance sales.
Shein’s median prices fell in eight of the 11 categories analyzed, including less seasonal products. The median price of jeans, for example, dropped to R$82 from R$139. Shirts fell to R$65 from R$81, T-shirts to R$40 from R$48, and pants to R$84 from R$97.
Brazil’s “blusinhas tax”
BTG also links the tougher competitive environment to the rebound in cross-border shopping.
Data from Remessa Conforme cited in the report show cross-border import volumes running well above levels seen before the latest tax change. According to the analysts, lower taxation has “quickly reignited” demand for overseas purchases.
Created by Brazil’s Federal Revenue Service, Remessa Conforme is a customs compliance program for international e-commerce platforms. Participating companies collect applicable taxes at checkout and submit purchase information to Brazilian authorities in advance, helping speed up customs clearance.
Since May 12, purchases of up to $50 through participating platforms have been exempt from the federal import duty, although they remain subject to Brazil’s state-level ICMS sales tax, which ranges from 17% to 20%, depending on the state.
Before the change, a 20% federal import duty had applied to those purchases from August 2024 through May 11, 2026.
According to BTG, Renner has taken the most cautious stance among the listed retailers when discussing the rise of international platforms.
The company cited increased activity from cross-border competitors as one of the factors behind weaker sales growth and incorporated the issue into a downward revision of its growth guidance, although it has not signaled plans to respond with a price war.
C&A has also acknowledged what it sees as a competitive asymmetry, but said it does not intend to sacrifice margins, instead relying on product differentiation, quality and its broader value proposition, according to BTG.
Riachuelo has likewise criticized the tax asymmetry and said it is responding through vertical integration, technology and greater use of pricing intelligence.
BTG cautions that its index measures listed prices rather than sales volumes or market share. The wider price gap therefore does not, by itself, mean that Shein is gaining market share at a comparable pace.
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