What is a tariff?

The concept of tariff refers to the rate or impuesto which applies above all to imports with the purpose of protecting the local business fabric. Tariffs are also often used on exports, with the aim of increasing tax collection.

The application of tariffs takes place in a protectionist economic policy, which seeks to favor the consumption of goods created in the territory itself. In this way, those articles of a similar cut to those manufactured in the country of origin are levied with a tariff to increase the final price for the final customer and between the two available options, keep the premises as it is cheaper.

The application of tariffs will have a significant impact on the economy. On the one hand, it will be a source of revenue for the State, with national products benefiting as a result of state protection. On the opposite side is that some items are out of reach of users due to the high price and the generalization of this type of measures can lead to the slowdown of the economy and the closure of markets.

Types of tariffs

It is necessary to differentiate between four classes of tariffs depending on the rate applied:

  • Ad valoren: consists of a tariff that is measured as a percentage of the value of the merchandise. A 15% tariff will imply that a 15% rate will be applied to the value of the product.
  • Specific: in this case, the tariff is specified based on an economic amount determined per unit or quantity of merchandise. For example, a tariff of 1.500 euros can be applied for a ton of product.
  • Mixed: the tariff uses combined values ​​from the two previous cases.
  • Compound: consists of an ad valorem tariff in which a minimum or maximum is established, although it can also be a specific tariff that is applied when the ad valorem does not reach a minimum value or when it exceeds a maximum figure .

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