Sales tax glossary
What is GST?
A goods and services tax (GST) is a value-added tax on most goods and services, used under that name in countries including Canada, Australia, New Zealand, India and Singapore. Like VAT, it's collected at each stage of the supply chain, and businesses generally claim credits for GST paid on purchases.
Example
Canada charges a 5% federal GST. A registered Canadian business charges GST on its sales and claims input tax credits for the GST it paid on business expenses.
Source: Canada Revenue Agency: GST/HST rates (opens in a new tab)
Why it matters for sellers
Foreign sellers of digital services and low-value goods may need to register for GST in countries such as Canada, Australia and New Zealand once their sales there pass local thresholds. Each country sets its own rules for registering, charging and filing.
Related terms
This definition is general information, not tax or legal advice. Rules vary by jurisdiction and change over time.
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