Why do countries use tariffs?

Tariffs are customs duties, consisting of export duties and import duties. These are indirect taxes imposed on goods exported or imported in a given country.

Import duties can be seen as a form of protectionism: protecting the own market against competing imports from other countries. Export duties often have a political character or importance. Generally, tariffs are set on certain products with the objective of discouraging their importation, thus promoting national production.

Tariffs are a political tool that have been used throughout history to control the amount of imports that flow into a country and to determine which nations will be granted the most favorable trading conditions. High tariffs create protectionism, shielding a domestic industry's products against foreign competition.

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