If the item or service is sold at retail -- retail is for consumption, not an item such as clay you need to create your retail products from -- and has not previously had the NRST applied then it is taxable. Buy a thousand parts and tools required to build a car, build it and then turn around and sell it and the only tax collected is on the sale of the car. None of the tools or parts are taxed. Conversely, if you buy a water pump for your car you'll pay tax on that.
actually here is how they do it in Canada for example we build houses
we pay GST on all the materials we buy to build the house and we pay GST to most of our trades ( if you don't make over $30,000 from your business, as a subtrade, you don't have to collect the Goods and Services)
then we collect the tax when we sell the house to a purchaser, now with houses we get a special deal, we offset the tax with a rebate, but that is just new housing
so you take the amount of tax you collected then offset it by the GST you paid your suppliers and subtrades and if then you either have to pay the difference or get a refund
(some fool in my hometown just ripped the GST people off for $700,000 - he kept claiming bogus refunds with no revenue coming in - he was renovating a building supposedly)
sound complicated yeah it's a bitch and the rules for grocery stores and retail stores is even more confusing - a Conservative government brought in the GST and Jean Chretien said he would scrap the tax if elected and so I actually broke party ranks and voted for Chretien believing him, I realize what a fool I was like, the one and only time I vote for a lying Liberal,
the Liberals realized what a cash cow it was, and kept the tax, it used to cost 50 cents to collect every dollar, the most expensive tax to collect ever but I don't know if that has improved.......