What are Tariff Barriers?
When two nations trade in commodities, the country in which the goods are exported levies a tax in order to generate revenue for the government while also raising the price of foreign goods so that domestic firms can compete with foreign products. The fee is in the form of a tax or duty which is referred to as a Tariff Barrier. The amount of tax or duty levied as a tariff is added to the cost of the import, making foreign goods more expensive, which is ultimately borne by the product’s customer. The tariff is paid to the customs authorities of the country where the goods are being sent.
Examples of Tariff Barriers:
- Export Duties
- Import Duties
- Transit Duties
- Specific Duties
- Ad-valorem Duties
- Compound Duties
Difference between Tariff and Non-tariff Barriers
Tariff and Non-tariff Barriers are different from each other. Tariff Barriers are the fees charged in the form of a tax or duty. However, Non-Tariff Barriers are the non-tax measures used by the government of a country in order to restrict imports from foreign countries.
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