From: Alan Browne <>
Subject: Re: American companies that offer to take Canadian sales tax payments
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NNTP-Posting-Date: Sat, 23 Dec 2017 08:02:39 -0600
Subject: Re: American companies that offer to take Canadian sales tax payments
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From: Alan Browne <>
Date: Sat, 23 Dec 2017 09:02:39 -0500
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On 2017-12-23 01:29, RichA wrote:
> The way it works is that you pay for an item from an American source,
> and include the sales tax you'd normally pay once it reached you.
> UPS, the post office, mostly always charge a tax, if the item is over
> $50 in value (ballpark) and if it comes from an "official" (invoice
> is included) source like a store.  I've had private sales go through
> Ebay where no tax was levied up to $300 value of the item.  Now, Ebay
> has its "global shipping program" (items are shipped by the seller to
> Kentucky where Pitney Bowes processes them, levying the end sales tax
> normally by the consumer paid to a Canadian province and a
> supplemental fee as well.  It even shows as a separate billing from
> the retail price and vendor on Paypal. But companies like B&H have a
> system like it too.  The benefit is that there is no scam "brokerage
> charge" (this is a sleazy charge levied in addition to the shipping
> charge when low-priced ground services are used.  So you might as
> well go with an express service on cheap items).  You pay the
> Canadian provincial tax up-front. But I'm wondering if the tax is
> actually fully-remitted to the tax authorities in those provinces?
> Apparently, a story appeared recently that some companies were taking
> the tax but not remitting all of it.  I don't exactly know how that
> would be possible.

The Legal Way:
If a company has operations in Canada then they can apply tax credits 
against Canadian VAT collected in the US against sales taxes they pay in 
Canada.  You don't remit all of the sales tax, only the difference 
between sales tax collected and sales taxes paid (for all things).  That 
is the nature of Value Added Tax: only the end consumer pays the full VAT.

So, if Amazon in the US collect a Canadian sales tax, they may be able 
to legally keep a chunk of it against their Canadian operations costs 
(sales taxed in Canada).  (This is not a good example as it's actually 
not easy to buy from Amazon in the US from Canada.  Easier to use the 
Canadian site).

The Dodging Way:
Possible?  Sure.  The web page tallies up the costs and taxes and you 
pay it.

There's no guarantee they are actually remitting the taxes.  OTOH as an 
example, Revenue Canada, Revenu Québec, et al, will inspect those 
companies with high shipping volumes and send demand letters if they 
don't see remittances.  (Indeed, Revenu Québec demands that companies 
outside Quebec that collect QST/GST be registered with them.  Revenu 
Québec handles the GST as well).

If your KY company collects taxes at sale and doesn't remit to Quebec 
then you can be sure that the AG (or tax agency) in that state would 
receive a Revenu Québec letter demanding action.  The FBI could get 
involved if it were deemed mail fraud.  Could get very ugly for a 
company collecting and not remitting.

It could also be that the collection co. discounts the remittance to 
cover credit card fees and cost of remittance.  As long as that discount 
were reasonable I doubt RQ would mind much.