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In Canada, exports are «zero-rated» sales for Grams.S.T. purposes. This means that when you ship a product to someone outside Canada, you don’t charge F.S.T. Yet, you get declare (or deduct from the G.S.T. collected by you) all the «input tax credits» (G.S.T. that you paid for business purposes) to make that move. The idea, I suppose, is to encourage transferring.
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The rationale behind this follows: Since countries can’t collect sales tax on Internet transactions at their borders, the sole method they can collect it (other than the self-assessment system) is by having an online sales tax. Further, it is claimed that businesses in nations suffer a major competitive disadvantage because weather resistant collect Vat (VAT) but others just won’t.
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Since they paid the G.S.T., would you think you should charge it again, an individual? «Wrong!», smiles the Cheshire cat. Since you are a registrant located in Canada, you must charge and remit the G.S.T.
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