GLC Pricing Policy vs Canadian Taxe Regulations

[luc]

Greetings members,

One of our customer brough a point to my attention by asking me why taxes are present on our products and services. Is question is very relevant and I have decided to post my answer to him on this forum, so peoples will understand few points.

Customer

Shipping cost i understand but federal/state tax? these parts are for resale of an end product,i purchased parts from overseas all the time and i never payed a tariff or tax for parts.

Our answer

Dear customer,

......

As for the taxes, being a Quebec and Canadian company at the same time, We are bound and forced to imply both provincial and federal taxes when we sell products or services and send it to the goverment. It is not our money you know and we have to send it to the goverment(s). I have no choice and that's the law here. For the plans you have purchased, the taxes are part of the price because it is a little amount. But for bigger prices, we have decided to make the taxes visible so our customers will not think we are over pricing our products. The good news for you is that for outside Canada customer, these taxes are reclaimable. I don't really know how to do it, but you can have these taxes refunded to you. I just don't know if it is trough your goverment or the Canadian goverment. Talk to your account, they should have all those details.

As for purchasing products overseas, if they don't have taxes, you won't get charge for. Or many companies doing world wide buisness have decided to include taxes in their prices. So basically, you think you are not paying taxes but you do and you can't claim it back since it is an unvisible taxe. Ours is visible so you can have it back. For a $2,550.00 130R engine, the taxes are $375.00,which you can have back in your pocket. If we price the engine at $2925.00, peoples will think it is to expensive and if they do purchase it, they will loose the taxe refund.

As you can see, we are doing the best we can for our customers ... But there is simply some regulations we can't go arround.

I hope this clarify a few things and actually, you just brough up a very good point here and I think I should put the information on both forum.

Thanks and best regards,

Luc Laforest
Conception GLC inc.
Tel : 418-275-8877
Cell : 418-455-9717
Fax : 418-275-0147
Email : luclaforest@glc-inc.ca
Web : www.glc-inc.ca

[Mike Kirney]

Luc, you should not be charging any kind of sales tax on sales to the USA or any other country. The post office or shipping company will calculate the sales tax payable based on the declared value of the shipment and will collect and remit it to the appropriate government. For all sales within Canada, you should be charging GST and most likely PST even on shipments going outside of Quebec. Rolling the GST/PST into the purchase price is a definite no-no, especially on international sales (inlcuding USA). The law clearly states that the retail price must be displayed and then any taxes are to be added to that displayed price and all amounts are to be displayed. Sometimes people will sell stuff 'taxes in' but when make the reciept they will 'back-calculate' it and write it so it looks like they charged a certain amount and then added the tax. You are not required to charge or remit GST on your first $30,000 of sales, so sales tax is not an issue for you right now and probably won't be till next year. Do you have a GST number yet? You can get one over the phone by calling CCRA. It takes about 15 minutes.

[luc]

Greetings guys,

Mike, you're mostly correct, but not totally. Yes you are correct with your statement about the post office. But where you are missing it, is when selling and shipping outside Canada, all products must be free from customs, with some additionnal fees.

Also and most important ... You need to fill-up a B-13 form in order to be in accordance with the law. If you fail to do so, the custom agents will forgive you only once, the next time, the penality charges are of $1000.00 CDN. Now, if you fill-up the B-13 form and there is a mistake in it, there is a $100.00 penality charge for each wrongly filled-up B-13.

Anyway, you just came in before I had time to correct my own above statement.

We have just finish talking with our internationnal Brooker and he gave me all the details for that issue. Also, we just obtained our own Import / Export Number, so taxes are thing of the past now and out of the picture.

For the peoples involved, I have just sent revised quote to correct the situation.

So ... For outside Canada Customers ... Taxes Not Applicable

Best regards,

Luc

[Mike Kirney]

Thanks for the clarification, Luc. I knew I was mostly right, because whenever I get stuff from the USA via Canada Post, I have to pay the GST at the post office when I go to pick it up. I got my own GST/import/export number just so I could save money on that steam engine I bought but it didn't work and I had to pay it anyway. I was missing one of their goddamn forms or something, I dunno.

[Anthony]

No way I'm buying from you guys now!

Just kidding...

[paul skinner]

Hi Luc.

Not sure who you're using for transshipments, but I found Kuehne + Nagel Group to be excellent for heavy, or oversize shipments.
After the fiasco last fall of using Fedex to ship, I did some searching and came across this company. They do everything. And their customs brokerage fees are less then most companies.
A heads up also. Recently Fedex and UPS have started to charge a flat $40 (USD) rate for brokerage fees. The catch is, if the buyer refuses to pay the costs (which I did regarding fedex tradenetworks, thieves that they are), the cost goes back to the shipper.

Paul.

[Mike Kirney]

Frankly, I don't see any reason not to ship by regular first class mail. It's way cheaper than ExpressPost, takes only two weeks to reach most places in Canada and the USA, and is more reliable than most people give it credit for. I've only ever had one problem, a lost pair of pants coming from Alaska, but I think that might have been because of the strike they just finished having.