What are tariffs and why are they used?

Tariffs are a tax a government puts on good which are imported into a country. This increases the price per unit of the imported good and is often used by governments o attempt to encourage individuals to purchase domestic goods rather than imported ones, thus protecting domestic industries. Another reason governments impose tariffs is so that they can extract taxation from it and thus increase their revenue. In this day and age tariffs often have negative connotations, as shown during the current Sino-US trade war in which the two countries are constantly raising tariffs on certain goods of each other in order to attempt to protect their own economies. Perhaps the first time we really saw tariffs used on a widespread scale would have been during the USA's great depression in which they raised tariffs on imported agriculture and manufactured products, leading to other countries also raising the tariffs on them.

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Answered by Nathan F. Economics tutor

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