11645-2(CRL)
XXXXX October 10, 1995
Under the provisions of the Excise Tax Act, a Goods and Services Tax (GST) is charged on all imported goods unless those goods are specifically relieved from the tax. In this case, there is no specific provision for the relief of the GST and the books will be subject to 7% GST on the value of the books. The value for duty is determined under the laws relating to the Customs Act.
With respect to your comments concerning the refund of GST, I must advise you that there is no provision in the Excise Tax Act for a refund of the GST, under the conditions you have noted in your letter.
If you are soliciting or offering for sale prescribed publications to be sent by mail or courier to a recipient in Canada, and your total worldwide annual sales are in excess of $30,000, then you are required to register for the GST. Registration would provide you with a number of benefits, should you wish to send books by mail or courier, to clients in Canada. By law, publications are detained by Canada Customs at time of importation. Canada Customs assesses the applicable duties and taxes which are collected by Canada Post. In addition to the payment of the duties and taxes, Canada Post assesses an additional $5.00 handling fee for collecting the duties and taxes. In this case, duty will not be assessed on the books. If you are registered for the GST, any prescribed publications sent to Canada, will be mailed directly to the addressee and you will remit the GST to the Department of National Revenue. Please note that prescribed publications include books, newspapers, magazines and audio cassettes when packaged together with a book.
You may also be required to register for the GST if your total worldwide annual sales are in excess of $30,000 and you are considered to be carrying on business in Canada. You may even register voluntarily if you regularly solicit sales of books to be delivered in Canada.
If you are registered for the GST, you get back the GST you were charged on your purchases and on operating expenses you acquire for use or consumption in your commercial activities - that is, the purchases and expenses you use to provide taxable goods and services. You can also get back any GST paid or owing on the importation into Canada of goods for use or consumption in the course of your commercial activities. You recover the GST you paid or owe by claiming an input tax credit on your GST return.
To help explain the GST and determine whether you are required to register or may register voluntarily, I am enclosing a guide entitled, "Doing Business in Canada - A Guide for Non-residents". Should you require additional information, you can contact the Tax Services office in XXXXX . The address and telephone number of the office appears on the back cover of that guide.
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