Shopify has had a turbulent couple of months, to say the least, and now the Canada Revenue Agency (CRA) wants to look into the company’s business records.
The CRA is asking the company to hand over six years of records for all its Canadian Shopify stores. According to a report by Store Leads, a database of e-commerce stores, there are 121,651 live Shopify stores in Canada.
Shopify CEO Tobi Lütke made the announcement in a June 23 tweet where he accused the tax agency of overreaching.
I don’t particularly want a fight with the CRA (Canada’s tax authority)- but we got asked to backchannel them 6 years of records for all Canadian Shopify stores. This feels like low-key overreach to me. We will fight this.
— tobi lutke (@tobi) June 24, 2023
Lütke co-founded Shopify in September 2004 and has been the CEO since April 2008. Daily Hive reached out to Shopify for a comment but was directed to Lütke’s tweet.
Shopify CEO Tobias Lütke/Linkedin | JHVEPhoto/Shutterstock
In an email, an agency representative stated that the CRA “uses the information obtained through Unnamed Persons Requirements (UPRs) to identify taxpayers that may have been non-compliant, and verifies that they have appropriately reported their income and have satisfied their filing obligations under the Acts administered by the CRA.”
The agency assured that it takes the security and privacy of taxpayers seriously and only collects information where it’s “lawful and directly related to compliance activities.”
JHVEPhoto/Shutterstock
The spokesperson also stated that the CRA is required to obtain judicial authorization first before issuing a requirement to a third party “to get information about one or more unnamed persons.”
So whether or not the company will eventually be forced to provide business records remains to be seen.
It’s also just one of the issues that Shopify is currently dealing with.
In May, the Canadian e-commerce giant announced that it was laying off 20% of its workforce and it was selling off Shopify Logistics to “pay unshared attention to [Shopify’s] mission.”
Terminated employees then filed a $130 million class action lawsuit against the company, with the former employees alleging the employer tried to slash their severance packages once they accepted the deal.
With files from Imaan Sheikh
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