Sales Tax - actual rules from CRA

[Western Metal Inc]

We are asked this question every day. We called the CRA and had a long discussion about the laws when we established the webstore, and again yesterday - to make sure the laws haven't changed.
It is not Western Metal Incs desire to be the tax collector but we will follow the letter of the law to keep from being prosecuted. There is no end around from this tax - we are asked by customers "if the customer pays the freight can we show it as being sold in Alberta?" No - that is mentioned in the examples listed in the link below and we would be caught eventually. The fines and penalties are, in most cases, larger than the taxes owing and have been known to put a business into bankruptcy.
Readers Digest version - the taxes have to be paid based upon the tax laws of the province where the products are being shipped. If you want to check on this with CRA call them at 1-800-267-2384.
You can also see examples of this ruling at the following link. Once you are at the link go down the page to "Goods (tangible personal property) - click this option. Then go to "Sale of Goods" click this option. Then go to "see examples for general rules - sale of goods.
The picture below is the same page that the link will take you to after following the directions.
Thank you.

http://www.cra-arc.gc.ca/placeofsupply/

[LuckyOnes]

guess we need to revolt to get lower taxes.

[OldFrankHog]

This applies to HST provinces, if in your example you had a Quebec resident buying from you, you have no obligation, or RIGHT, as a matter a fact, to collect the provincial sales tax, only the Federal taxes.

[Western Metal Inc]

This applies to HST provinces, if in your example you had a Quebec resident buying from you, you have no obligation, or RIGHT, as a matter a fact, to collect the provincial sales tax, only the Federal taxes.

Correct. The tax laws of the province have to be followed.

[Phat Eagle]

Ok, so other suppliers in Alberta only charge the 5% GST on goods sold to BC, as we reverted to PST a few years back after our short HST experiment. Is this your practice as well?

[andrew3081]

Correct. The tax laws of the province have to be followed.

BC is a NOT a HST province and yet we still get charged the full 12% tax?

[Western Metal Inc]

Ok, so other suppliers in Alberta only charge the 5% GST on goods sold to BC, as we reverted to PST a few years back after our short HST experiment. Is this your practice as well?

We were directed by the CRA to charge the higher tax to BC residents. Please feel free to call them - not our desire to charge more tax.

[OldFrankHog]

CRA has no jurisdiction on provincial sales taxes, you misunderstand the meaning of the law. HST provinces get charged HST rate. Other provinces get charged Federal 5% only unless you have place of business in said province, than you need to apply provincial taxes as well.

[Western Metal Inc]

CRA has no jurisdiction on provincial sales taxes, you misunderstand the meaning of the law. HST provinces get charged HST rate. Other provinces get charged Federal 5% only unless you have place of business in said province, than you need to apply provincial taxes as well.

In the case of BC we are directed by the Federal Government to collect the 5% GST and remit to the federal government. And we are directed to collect the BC PST and remit to the BC government.
Feel free to call the CRA.

[OldFrankHog]

http://canadabusiness.ca/government/...ing-sales-tax/