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This entire post is an over-simplification of an extremely complex topic. Obviously, this is just scatching the surface. You will certainly require expert recommendations to assist you through E-Commerce Taxland.
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Oddly, the very same reasoning doesn't use when an American buys a routine book (or a vehicle) which he COULD bring into Canada with him and utilize here. It is true that it is easier for Canada to examine such items at the border than in the online world, but I understand of no cases of Americans being taxed on the cars or books they bring with them when they pertain to reside in Canada for about half the year.
Pretend that your Canadian consumer has actually purchased a book from you from your Canadian site. Your drop ship provider lies in the United States and is registered for G.S.T. You fax your order to the American company, and they, in turn, ship the book for you (total with Customs Statement and their G.S.T.
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