Tariff

What is a Tariff?

A tariff is a tax or duty that a government charges on imported goods (and sometimes on exported goods). It is used to raise revenue, protect domestic industries, or influence trade policy.

Key points:

• Tariffs can be ad valorem (a percentage of value) or specific (a fixed amount per unit).
• The importer generally pays the tariff at the border, which is often passed on to consumers via higher prices.
• Tariffs may provoke retaliation, distort trade flows, and create economic inefficiencies.