ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A tariff is a tax levied on an imported good with the intent to limit the volume of foreign imports, protect domestic employment, reduce competition among domestic industries, and increase government revenue.

Detailed explanation-2: -Answer: Tax on imports is known as a trade barrier because it increases the price of imported commodities.

Detailed explanation-3: -Tariffs increase the price of goods and services in domestic markets by applying a tax on imported goods that is paid by the domestic importer. To cover the increased costs, the domestic importer then charges higher prices for the goods and services.

Detailed explanation-4: -Tariffs are a form of tax applied on imports from other countries. Economists say the costs are largely passed on to consumers. They have historically been used to protect domestic industries, including agriculture and automobiles, as well as to retaliate against other countries’ unfair trade practices.