Thursday, 13 March 2014

The Difference between Duty and Tariff

When importing goods from another country the government applies various taxes, duty and tariff. The tariff is designed to protect the industries within the country where the goods are being imported to by restricting the amount of goods that can be traded, and it also creates revenue for the government. Duty is the indirect tax that also generates an income for the government and helps to protect the domestic industries. 

Duty Taxes
The custom duty is an indirect tax that the government applies to imported goods during an international trade as we mentioned above. Import duty is levied for goods that are imported. Export duty is the duties that must be paid to the government for exporting goods and it is seen as a consumption tax as the costs are imposed on consumers.

Tariff
The tariff is the form of duty or tax that is levied on products that has protective and revenue purposes as the goods are transported from one area of customs to another. The prices that need to be paid on each item are established according to the rules of the government. The nation is responsible for paying the cost of the tariff for the importing, exporting and trading products. They are useful for countries as it is beneficial for the government and it can help to protect the developing or underdeveloped domestic industries. Tariffs are used to control the trade between counties and they always add extra money to the amount the consumer needs to pay.

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