Kim Kardashian’s SKIMS Agrees to $200K Settlement After New Jersey Sales Tax Dispute
Kim Kardashian’s hugely popular SKIMS brand is once again making headlines, but this time it is not for a viral product launch or celebrity endorsement. The shapewear and apparel company has agreed to pay a $200,000 civil penalty after New Jersey officials accused it of unlawfully collecting sales tax on clothing that should have been tax-exempt.
The settlement closes a year-long issue that affected thousands of online shoppers in the Garden State.
Below is a full breakdown of what happened, why New Jersey took action, and what it means for consumers moving forward.
What New Jersey Alleged Against SKIMS
According to New Jersey Attorney General Matthew Platkin and the Division of Consumer Affairs, SKIMS Body Inc. improperly charged sales tax on everyday clothing sold to customers in New Jersey between 2019 and 2024. Under state law, most clothing and footwear are exempt from sales tax. Despite this, SKIMS allegedly applied tax charges during online checkout.
State officials say the issue was not a one-time mistake but a systemic problem. The Attorney General’s office stated that SKIMS failed to put safeguards in place to prevent New Jersey shoppers from being charged tax they did not owe.
Because the company primarily sells through its website, the responsibility to properly calculate state-specific tax exemptions fell squarely on the brand.
Why the Practice Violated State Law
New Jersey’s Consumer Fraud Act prohibits companies from engaging in practices that cause consumers to pay more than legally required. Authorities described SKIMS’ actions as “unconscionable business practices” due to the lack of internal systems that could have prevented the improper tax charges.
The issue dates back to the company’s launch. Kim Kardashian founded SKIMS in 2019, and state officials say the improper tax collection began almost immediately and continued for several years. During that time, the brand grew rapidly, attracting customers across the country and becoming a household name in fashion and shapewear.
The $200,000 Settlement Explained
As part of the settlement, SKIMS agreed to pay a $200,000 civil penalty to resolve the allegations. The agreement allows the company to avoid prolonged litigation while holding it financially accountable for the violations.
Attorney General Platkin emphasized the importance of enforcing consumer protection laws, especially during a time when costs are rising for everyday Americans. He said in a statement, “As prices on everything from clothing to groceries soar, our office is committed to protecting our residents from unlawful practices that drive up the prices they pay at the register.”
He continued, “We’re holding Skims accountable because their conduct harmed New Jersey consumers by requiring them to pay more than what they owed. We won’t tolerate conduct that unlawfully takes money out of the pockets of hard-working New Jerseyans.”
Refunds for Affected Customers
In addition to the civil penalty, SKIMS has already returned the improperly collected tax funds to the New Jersey Division of Taxation. The company is also actively working to identify customers who were charged sales tax in error so they can be reimbursed directly.
State officials confirmed that the case will remain open for four years. This extended period is meant to ensure that all eligible consumers have enough time to come forward and request refunds. The Division of Consumer Affairs said the extended oversight will help “facilitate and complete” the reimbursement process.
SKIMS also agreed to overhaul its tax collection processes to ensure compliance with New Jersey law going forward.
SKIMS Growth and Kardashian’s Wealth
The settlement comes as SKIMS continues to grow at a remarkable pace. The brand is known for its inclusive sizing and celebrity-backed appeal, with products ranging from shapewear and bras to face masks and loungewear.
Over the years, celebrities from Kim Cattrall to Anthony Hopkins have been spotted wearing SKIMS products, adding to the brand’s cultural reach.
By 2023, SKIMS was valued at $4 billion. That figure reportedly rose to $5 billion by November 2025. Kim Kardashian herself is now worth nearly $2 billion, according to Forbes, placing her among the wealthiest self-made celebrities in the world.
What This Means for Online Shoppers
For consumers, the case serves as a reminder that even major brands can make costly compliance errors. Online shopping often feels seamless, but behind the scenes, companies must navigate complex tax rules that vary by state. When those systems fail, shoppers can end up paying more than they should.
New Jersey officials hope the settlement sends a clear message to retailers selling online. Companies are expected to understand and respect state tax exemptions, especially when those exemptions are designed to reduce costs for residents.
Final Takeaway
While SKIMS did not admit wrongdoing, the settlement underscores the importance of transparency and compliance in e-commerce. For New Jersey shoppers, refunds are on the way, and stronger safeguards are now in place.
For other retailers, the message from state officials is clear. Cutting corners on consumer protections can be costly, no matter how big or successful the brand may be.
As SKIMS continues its expansion, this case marks a rare but notable moment where rapid growth collided with regulatory oversight, reminding consumers and companies alike that the rules still apply.
Kim in Calabasas, promoting the new Nike x Skims shoes
byu/somegirlontheinter inKUWTK
Summary:
- SKIMS Body Inc. agreed to pay a $200,000 civil penalty to settle New Jersey fraud allegations.
- The company was accused of improperly charging sales tax on tax-exempt clothing sold online to New Jersey customers.
- New Jersey law exempts most everyday clothing and footwear from sales tax.
- The alleged violations occurred between 2019 and 2024.
- State officials said SKIMS lacked systems to prevent improper tax charges.
- The practice was labeled an unconscionable business practice under the New Jersey Consumer Fraud Act.
- SKIMS has returned the collected tax money to the New Jersey Division of Taxation.
- The company is working to reimburse affected customers directly.
- The case will remain open for four years to allow consumers time to claim refunds.
- SKIMS agreed to update its tax collection processes to prevent future issues.
- The brand’s valuation reached $5 billion in November 2025.
- New Jersey officials said the settlement reinforces consumer protection laws.
