1. Point 12 Sales Taxes
Sales taxes are collected by merchandising companies on the goods that they sell.
Sales taxes are recorded as a liability until they are paid to the governments.

2. GST rate in sales Type of taxpayer Annual sales GST rate China
The general taxpayer
Industrial enterprises
＞￥500,000
17%
 Commercial enterprises ＞￥800,000
Small-scale taxpayer
Industrial enterprises ≤ ￥500,000 3%
 Commercial enterprises ≤ ￥800,000
Canada
Any business
≥＄30,000 5%

3. So if we consider the tax, we should do the following entry:
Dr. Cash or A/R
Cr. Sales
Cr. GST Payable （ Sales ×rate）

4. If the annual sales of an Industrial enterprise in China is ￥450,000, On March 8, Xinxing Company sells
merchandise for ￥10,000 on account to Tianyu Company.

5. If the annual sales of an commercial enterprise in China is ￥1200,000, On March 8, Xinxing Company sells merchandise for ￥10,000 on account to Tianyu Company.

6. If the annual sales of Xinxing Company in Canada is
$ 50,000, On March 8, Xinxing Company sells merchandise for $10,000 on account to Tianyu Company.