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People outside of Canada are exempt from taxes.

People inside of Canada (non Ontario) get charged the 7% GST rate.

Additionally the ones who live in Ontario get charged 8% PST as well as 7% GST.

You need to have a GST and PST (also known as ontario retail sales tax) number to collect and remit taxes for the government. You need a vendors permit to get a PST number. Having a PST number is good because you can also be exempt from paying PST when you buy supplies for your business.

One important thing to note is that you are not required to collect GST/PST on behalf of the government if you're doing less than $30,000/year in business. You can however volunteer to do so if you'd like.

Also, the government doesn't care how you collect, they care how you remit. Example. You sell a t-shirt for $10 + $1.5 pst,gst included. You don't have to break it apart. You can simply sell it as $11.50. Now when you report to the government, obviously you say you sold a $10 shirt and thus you only owe them $1.50 in taxes.

Hope that helps.....
 
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