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Canada has what merchants also call a national florida sales tax or a worth added tax (VAT). This Goods and Services Tax (G.S.T.) of five percent (as at January 1, 2008) is applicable to many Canadian matters.

In Canada, exports are “zero-rated” sales for He.S.T. purposes. This means that a few ship something to someone outside Canada, you don’t charge G.S.T. Yet, you get to claim (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 export. The idea, I suppose, should be to encourage forwarding.

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