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In trying to comply with tax laws for your e-business, you may find yourself falling down the rabbit-hole, going through the looking glass, and attending a Mad Tea-Party.
Say you sold a subscription for accessing digitized content (from various sources) upon the Canadian web site to a customer in the states. Since there are no restrictions with where the intangible personal property can be used, and the property is not considered intellectual property (nor the provision of a service), the American customer is subject to G.S.T., even when he never comes to Canada.
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The rationale behind this follows: Since countries can't collect florida sales tax on Internet transactions at their borders, the very best they can collect it (other compared self-assessment system) is through online florida sales tax. Further, it is claimed that businesses in nations suffer a serious competitive disadvantage because should be collect Vat (VAT) but others don't.
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