Shopify says it has made changes to its platform in response to tariffs imposed by the new US administration.
“As soon as weʼve seen anything, whether itʼs tariffs or de minimis, we usually get to work from a product perspective,” Shopify President Harley Finkelstein told investors on the company’s Q4 earnings call.
Finkelstein noted that all Shopify sellers can now show and charge duties during checkout, so there are no surprises for the consumer at the last moment. The Canadian tech giant added these changes will make cross border transactions more straightforward for customers.
Overall, Shopify reported strong numbers in Q4 driven by robust holiday sales. Shopifyʼs net income nearly doubled to $1.29 billion from $657 million in the same quarter last year. GMV for merchants on Shopify rose 24% compared to last year with the Black Friday-Cyber Monday weekend generating $11.5 billion.
In early February, President Donald Trump imposed 25% tariffs on imports from Canada and Mexico, and 10% additional tariffs on imported goods from China. Trump also scrapped a duty-free exemption for small parcels, also known as de minimis.
However, tariffs to Canada and Mexico have since been paused for 30 days. Meanwhile, de minimis was also temporarily reinstated last week. The delay is expected until the Commerce Department has a proper system in place to collect tariff revenue per an executive order.
Finkelstein said tariffs impact “real entrepreneurs.”
“What we try to do with Shopify every day is we try to protect and empower every business we can, but obviously, especially, we care about the underdogs,” he said.
The de minimis trade provision permits shipments costing no more than $800 to enter the US duty free and with minimal paperwork and verification. The way Finkelstein sees it, de minimis keeps expenses down and encourages competition.
“We think protections like de minimis are crucial for small businesses that engage in trade,” Finkelstein said. “By exempting these low-value shipments from taxes and duties, they keep costs down and allow entrepreneurs, I think, to compete at a much larger scale.”