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In Canada, exports are "zero-rated" sales for Gary the gadget guy PGSLOT .S.T. purposes. This means that if you ship a product to someone outside Canada, you don't charge Gary.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 export. The idea, I suppose, is to encourage exporting.
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The rationale behind this follows: Since countries can't collect sales tax on Internet transactions at their borders, the best they can collect it (other when compared with self-assessment system) is by online sales tax. Further, it is claimed that people in the ecu Union suffer a major competitive disadvantage because they've got to collect Value Added Tax (VAT) but others don't.
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