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Say you offered a subscription for accessing digitized material (from various sources) on your Canadian website to a customer in the United States. Given that there are no limitations as to where the intangible personal effects may be used, and the property is not considered intellectual residential or commercial property (nor the provision of a service), the American client is subject to G.S.T., even if he never comes to Canada.
Now, don't get mad a start making accusations about all the shallow individuals out there. While it might hold true that some people position too much emphasis on physical appearances, the bottom line is it does make a difference when 2 people are satisfying and making initial examinations of their interest in each other. And, it's also a trust thing. It is constantly going to be much easier to communicate with a face than with a blank box.
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In Canada, exports are "zero-rated" sales for G.S.T. purposes. This means that when you deliveran item to somebody outside Canada, you do not charge G.S.T. Yet, you get to claim (or deduct from the G.S.T. gathered by you) all the "input tax credits" (G.S.T. that you paid for tips for carrom organizationfunctions) to make that export. The idea, I suppose, is to motivate exporting.
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Pretend that your Canadian customer has purchased a book from you from your Canadian site. Your drop ship supplier lies in the United States and is signed up for G.S.T. You fax your order to the American company, and they, in turn, deliver the book for you (total with Customs Statement and their G.S.T.
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