The term, referring to a specific arrangement of levies on imported goods, is a fundamental concept in international trade. For instance, a nation might impose a specific rate on imported steel to protect its domestic steel industry.
These levies serve multiple purposes. They can generate revenue for governments, protect domestic industries from foreign competition, and influence consumer behavior. Historically, they have been used as instruments of policy, shaping international relations and trade flows. Understanding the implications of this instrument is critical for businesses engaged in global commerce, policymakers shaping economic strategies, and consumers impacted by pricing fluctuations.