VAT exemptions do not work in the same way that RST exemptions do. An exemption relieves the seller from collecting the VAT on its sales, but it does not relieve the seller from paying tax on its purchases. There are no purchase suspension certificates in the VAT. For exempt goods and services, the seller of the service is treated like the consumer of its purchases. In general, with the VAT, businesses do not want their product to be exempt; by being registered vendors of taxed goods or services, they have a mechanism for refund of the VAT that they pay on their purchases. Without that registration, they pay the tax without refund. Unless the business purchases very little from other businesses (certain service providers would be an example), so that very little of its operating cost is covered by the VAT, it will much prefer to be selling a taxed rather than an exempt product.