‘Hitting back will not lead to anything good’: Shopify CEO criticizes Canada’s response to U.S. tariffs

Shopify Inc. headquarters signage in Ottawa on May 3, 2022 (THE CANADIAN PRESS/Sean Kilpatrick)

The head of Ottawa-based Shopify says it is “simply the wrong choice” for the federal government to impose counter tariffs on U.S. items, as a trade war begins between Canada and the United States.

U.S. President Donald Trump signed an executive order Saturday imposing a 25 per cent tariff on Canadian imports and a 10 per cent tariff on Canadian energy.

Shopify CEO Tobi Lutke criticized the federal government’s announcement Saturday night that Canada would impose counter tariffs on $30 billion in American goods, like alcohol and fruit, starting Tuesday, adding another $125 billion in tariffs in 21 days on hundreds of other American goods.

“I’m disappointed that Trump admin placed the 25 per cent tariffs. I’m disappointed that this is our governments response,” Lutke said in response to a post on X with Prime Minister Justin Trudeau’s announcement.

“Canada thrives when it works with America together. Win by helping America win. Trump believes that Canada has not held its side of the bargain, and he set terms to prove that we still work together: get the borders under control and crack down on fentanyl dens. These are things that every Canadian wants its government to do, too. These are not crazy demands, even if they came from an unpopular source.”

The White House said Saturday that Trump was imposing tariffs on imports from Canada, Mexico and China to address “an emergency situation.”

“The extraordinary threat posted by illegal aliens and drugs, including deadly fentanyl, constitutes a national emergency under the International Emergency Economic Powers Act (IEEPA,” said a statement from the White House Saturday.

Less than one per cent of fentanyl and illegal crossings into the United States come from Canada, with U.S. Customs and Border Protection seizing just 43 pounds of fentanyl at the northern border in the 2024 fiscal year.

Federal officials in Canada have repeatedly emphasized these and similar statistics, while initiating rounds of lobbying efforts with D.C. officials about Canada’s $1.3-billion border security enhancements in the face of Trump’s demand to crack down on the flow of migrants and drugs at the northern border.

Lutke warns the tariffs are going to be “devastating to so many people’s lives and small businesses.”

“Action has to be judged based on what it leads to, not how good it sounds or feels. Leadership is about doing what’s right, not what is popular. And hitting back will not lead to anything good,” Lutke said.

“America will shrug it off. Canada will decline. It’s simply the wrong choice in a possibility space where much better options would have been available.”

On Sunday, Lutke announced Shopify is introducing features aimed at encouraging people to buy local in Canada, the U.S. and Mexico on the company’s app.

The Canadian Chamber of Commerce has warned the tariffs will “drastically increase the cost of everything for everyone.”

“Our supply chains are so deeply integrated that you can’t unwind them overnight. They are integrated not simply because we get along as neighbours, but because it makes sense financially for businesses and consumers on both sides of the border,” Candace Laing, president and CEO of the Canadian Chamber of Commerce, said in a statement on Saturday,

“Which is why if President Trump truly wanted to bring down costs for Americans, he would be looking at strengthening our trade ties, not tearing them apart. This decision makes no sense when the majority of Americans oppose tariffs, when it harms businesses and workers on both sides of the border, and when the U.S. stock market is signaling that there’s no appetite for disruption.”

In a post last Wednesday, Lutke said that the tariffs “are avoidable,” adding Canada should “secure the border and do a better job on cracking down on drugs.”

“Starting a trade and tariff war that will plunge Canada further into poverty just doesn’t make any sense for anyone. Also, I can’t speak for everyone, but I’d very much like us to crack down on fentanyl myself! Who doesn’t?” Lutke said.

“Play stupid games, win stupid prizes.”

With files from CTV News National Correspondent Rachel Aiello