Understanding Tariffs and Customs Duties

What is the primary purpose of a tariff?

• To protect local industries

• To increase the price of goods

• To promote international trade

• To reduce government revenue

Which term is synonymous with customs duties?

• Tariff

• Import fees

• Sales tax

• Excise duty

What is an import tariff?

• A tax on domestic sales

• A tax on exported goods

• A tax on services

• A tax on goods entering a country

What does a protective tariff aim to do?

• Increase government revenue

• Protect domestic producers

• Reduce the cost of imports

• Encourage foreign imports

What is the difference between a tax and a customs duty?

• Duties are not collected by the government

• Taxes are only for exports

• Duties are only for imports

• Duties apply to all goods

What is an export tariff primarily used for?

• To reduce local production

• To increase export volume

• To protect local currency

• To promote foreign trade

Which of the following is a type of regular customs duty?

• Compensatory customs duties

• Environmental customs duties

• Ad valorem customs duties

• Regulatory customs duties

What is the purpose of a sumptuary tariff?

• To limit consumption of harmful goods

• To encourage imports

• To protect local industries

• To raise government revenue

What does 'ad valorem' mean in the context of customs duties?

• Based on a fixed amount

• Based on the value of goods

• Based on the weight of goods

• Based on the country of origin

What is a prohibitive tariff?

• A high tariff that restricts imports

• A tariff that allows some imports

• A tariff that applies only to exports

• A low tariff to encourage imports