What is a Tariff? Definition Quiz and Flashcards

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Questions and Answers

What is the primary purpose of a customs tariff or duty?

To promote free trade and open markets

To protect domestic industries from foreign competition

To generate revenue for the government (correct)

To control the flow of illegal goods across borders

Which of the following best describes the concept of a 'customs schedule'?

The process of calculating the total amount of customs duties owed

A system for tracking the movement of goods through customs

A list of imported goods and their corresponding tariff rates (correct)

A schedule of events for customs officials to follow

Which of the following is a potential negative consequence of high customs tariffs or duties?

Improved domestic job market

Stronger national security

Increased government revenue

Reduced consumer choice (correct)

What is the primary economic rationale for the imposition of customs tariffs or duties?

To protect domestic industries from foreign competition Signup and view all the answers

Which of the following is a key function of a customs authority or agency?

To set and enforce tariff rates on imported goods Signup and view all the answers

What is the primary purpose of a customs union, such as the European Union?

To eliminate tariffs and trade barriers between member countries Signup and view all the answers

Which objective first led to the levying of customs duties for revenue purposes?

Generating revenue Signup and view all the answers

Why did import prohibitions gradually decline from about 1750 to 1850?

They led to a rise in smuggling activities Signup and view all the answers

During the World War and the subsequent reconstruction period, what form did tariffs take?

Contingents Signup and view all the answers

What was the primary reason for the return of import prohibitions during the World War and the subsequent reconstruction period?

To combat smuggling activities Signup and view all the answers

In what period did import prohibitions largely vanish before the World War?

18th and 19th century Signup and view all the answers

What was the dominant reason for utilizing export duties in tropical and subtropical countries?

To generate revenue Signup and view all the answers

What was the primary purpose of establishing different tariff rates based on the origin of goods and ships?

To promote domestic agriculture and arts by protecting them from foreign competition Signup and view all the answers

According to the passage, what is the fundamental characteristic of a tariff?

A schedule of rates for importing and exporting goods Signup and view all the answers

Which of the following statements best describes the purpose of a customs tariff?

To impose taxes on goods entering or leaving a customs area Signup and view all the answers

Based on the information provided, which of the following rates would be the highest for importing foreign goods?

Foreign goods in foreign ships Signup and view all the answers

What is the primary function of a tariff board or customs authority?

To establish and enforce tariff rates on imported and exported goods Signup and view all the answers

According to the passage, what is the primary factor that determines the tariff rate for a particular good?

The origin of the goods and the nationality of the ship carrying them Signup and view all the answers

Study Notes

Customs

A list or schedule of articles or merchandise with the rate of duty to be paid to the Government for their importation or exportation
A duty levied according to such a schedule or collectively on one class of articles
The system of imposing duties or taxes on the importation of foreign merchandise
Originated from duties paid from time immemorial, now considered public taxes on goods crossing the border of a territory

History of Customs

Initially, duties were only for revenue purposes
With the growth of mercantilism and nationalism in the 16th and 17th centuries, duties were used to protect domestic industries, promote a favorable balance of trade, and punish foreign countries
Export duties were abolished, and tariffs came to consist mainly of import duties, except in tropical and subtropical countries

Objectives of Levying Customs Duties

To increase revenue
To protect the agriculture and arts of the islands
To expand foreign commerce

Rate of Customs Duties

4 rates were established according to origin:
- Spanish goods in Spanish ships (lowest rate)
- Spanish goods in foreign ships
- Foreign goods in Spanish ships
- Foreign goods in foreign ships

Tariff

A table or catalog containing the names of several kinds of merchandise with the duties or customs to be paid
A schedule or rates of import or export duties
A tax levied on a commodity when it crosses the boundary of a customs area
Can be a cartel of commerce, a book of rates, or a table or catalogue

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Description

Test your knowledge on tariffs with this quiz covering the definition, types, and principles governing the imposition of duties. Explore the concept of tariffs and their impact on importation and exportation.

Tariff Definition Quiz