Category: 

What are Tariff Barriers?

Protectionism, in which nations promote the interests of domestic producers by restricting importers, is common in many nation.
Tariff barriers limit the amount of goods that can be imported into a country.
Article Details
  • Written By: Mary McMahon
  • Edited By: O. Wallace
  • Last Modified Date: 18 October 2014
  • Copyright Protected:
    2003-2014
    Conjecture Corporation
  • Print this Article
Free Widgets for your Site/Blog
The oldest known tortoise is 182 years old, and is believed by scientists to be the oldest living land creature.  more...

November 23 ,  1936 :  The modern version of "Life" magazine published its firs  more...

Tariff barriers are duties imposed on goods which effectively create an obstacle to trade, although this is not necessarily the purpose of putting tariffs in place. These barriers are also sometimes known as import restraints, because they limit the amount of goods which can be imported into a country. Many organizations which promote trade are concerned about both tariff and non-tariff barriers to free trade, and a number of nations have agreed to radically reduce their trade barriers to promote the exchange of goods across their borders.

A number of different types of duties can be levied when goods cross international boundaries. With an ad valorem duty, for example, the importer must pay a fee which is calculated as a percentage of the value of the goods being imported. Specific tariffs are set amounts which are levied on products which are imported, regardless of values, while environmental tariffs penalize nations with poor environmental records.

For importers, tariff barriers can make it difficult to bring goods into a country. The importer may be forced to import less because the tariff barriers cannot be afforded otherwise, and it may need to charge more for the goods to make importing worthwhile. Tariffs are designed to force importers to do this to level the field between domestic producers and importers, allowing costly domestic producers to compete with importers who may be able to bring in goods at lower cost.

Ad

Protectionism, in which nations promote the interests of domestic producers by restricting importers, is common in many nations, but it is also frowned upon, primarily by nations which want to be able to export goods for trade in other countries. Organizations such as the World Trade Organization have promoted the lifting of tariff barriers to reduce the burden on importers. Non-tariff barriers such as import quotas are also targeted for elimination by organizations which promote free trade.

Some tariff barriers are likely to always remain in place, even in nations which are very open to free trade. Changing the structure of tariffs, taxes, and related expenses is a continual project, and nations occasionally push back or lash out by radically altering their tariffs and other barriers to trade. Nations may also use trade barriers to make political statements which are designed to pressure other countries into modifying their behavior. For example, Country A might refuse to import beef from Country B until Country B can demonstrate that its meat supply is free of bovine spongiform encephalitis (BSE), also known as mad cow disease.

Ad

More from Wisegeek

You might also Like

Discuss this Article

Denha
Post 2

@accordion, I agree. While I was volunteering in the EU last year, my computer had problems and, because my warranty only worked in the country of purchase because it was from the US, I had to send it home. When it was sent back, I was almost charged a huge tax because they said that it was "like new". When I explained it had been repaired, they said, "Well, we don't have anything in our laws for things that have been repaired." Not only are the laws too much, they are often confusing and not thorough enough to even achieve what they intend.

accordion
Post 1

I personally believe that some level of customs tariff laws are acceptable, for example if you are within the European Union and order good from outside of it. At the same time, it seems that groups like the World Trade Organization should be helping nations to equalize these rules; for example, I can order EU products to be shipped to the United States for relatively little cost, while shipment into the EU from the states has a whole list of requirements and weight and value limits that need to be followed.

I also don't think these rules should even pertain to individuals at all unless they buy things in a really significant bulk, because even if, for example, every person in France ordered 100 dollars' personal merchandise from the US, it would not compare to the amount of money stores and other companies might order.

Post your comments

Post Anonymously

Login

username
password
forgot password?

Register

username
password
confirm
email