TARIFFS, CUSTOMS AND OTHER TRADE BARRIERS

Tariff

is a form of a tax levied on goods important into a country.

tariff

the oldest method of government’s attempt to control trade.

tariff barriers
non-tariff barriers

two types of trade barriers

Non-tariff barriers

This includes any form of government action that hampers or reduces the entrance of imported commodities in a country

• Quotas

• Products Standards

• Licensing Requirement

• Bureaucratic Customs Process

• Voluntary Restraints

• Voluntary Government Restraint Agreements

• Voluntary Exports Restraint Agreements

Non-tariff barriers:

quota

is a limitation on the amount or quantity of a commodity or commodities that may be imported in any given period.

Products Standards

these are government regulations to check the correct or proper standard of the goods imported as to its quality and safety. These standards are more present in home use commodities like LPG, bulbs and other electrical and home appliances

Licensing Requirements

These are regulatory permits that importers and/or distributors need to obtain before they can be allowed to engage in the importation and/or distribution of these imported products in the local markets.

Bureaucratic Customs Process

Customs Administration of a country may apply additional or burdensome customs process that a certain imported products may pass through before its final clearance from customs.

Voluntary Restraints

Voluntary export restrictions arrangements entered into by governments or private export firms to limit international trade for certain products in a particular period.

Voluntary Government Restraint Agreements-

Entered into by one government to another government of a country to limit or restrict the export of a certain goods from each other

Voluntary Exports Restraint Agreements

Entered into by the exporters themselves from country to limit or restrict the export of their products either one way or from each other in a particular usually in a particular period.

Tariff

denotes the lists or schedules of commodities with a particular duties or charges upon each noted

Customs

Customary tolls or dues paid by merchants upon commodities on their way to or from market

Tariff

is a table or catalog containing the names of several kinds of merchandise with the duties or customs to be paid therefore.

Customs tariff

is a schedule of rates of import or export duties

Customs

Are the duties or tariff payable upon merchandise imported.

Customs

Taxes levied upon goods and merchandise imported or exported.

Specific Duty

levied on imports that is proportional to the number of items or units imported (i.e., based on the weight, volume, gauge or other measure of quantity or based upon or regulated by value) without regard to its value.

Ad valorem Duty

is derived from the Latin word, literally means “according to value”. A tax levied which is equal to a certain percentage of the value of the imported articles.

Mixed or Compound Duty-

tax which comprises both specific and an ad valorem rate.

Revenue duty

is designed primarily to obtain or raise revenue for the government rather than to restrict imports. The tariff is usually minimal or modest and usually levied on products not produced locally

Protective duty

is intended to protect or shield domestic products from foreign competition by imposing a higher duties on imported commodities, thus restricting its entrant in the domestic markets giving domestic goods on a competitive edge.

1. As to Form

   • Specific Duty

   • Ad valorem Duty

   • Mixed or Compound Duty

2. As to Economic Purpose or Effect

   • Revenue duty

   • Protective duty

3. As to Special Purpose

   • Anti-dumping duty

   • Countervailing duty

   • Safeguard duty

4. As form of Penalty

   • Discriminatory duty

   • Marking duty

   • Transit duty

Classification of Customs Duties

• Specific Duty

• Ad valorem Duty

• Mixed or Compound Duty

Classification of Duties as to Form

• Revenue duty

• Protective duty

Classification of Duties as to Economic Purpose or Effect

• Anti-dumping duty

• Countervailing duty

• Safeguard duty

Classification of Duties as to Special Purpose

• Discriminatory duty

• Marking duty

• Transit duty

Classification of Duties as form of Penalty

Transit duty

is tax imposed on commodities for transiting/passing through a customs territory of a country en route to another territory of another country or for a stop- over privilege given by a country.

Marking duty

it is a penalty duty in addition to the usual duty, imposed against imported articles or its container which are not properly marked of its country of origin.

Discriminatory duty

is a penalty duty in addition to the regular duty, imposed by one country against the articles or product of a country that unequally imposes unreasonable charge or limitation which discriminate against the product of the discriminated country.

Safeguard duty

this is a new multilateral measure in the form of an “increase tariff” (in the case of industrial or non-tarrified imports) or additional special “safeguard duty” (in the case agricultural products) levied in addition to the regular duty against covered products being imported in an increased quantities, or its volume exceeds the trigger level or its C.I.F. value falls below the trigger price.

Countervailing duty

this special duty which is equal to the ascertained amount of subsidy granted, is intended to offset or forestall the subsidy or bounty directly or indirectly granted by the government of the exporting country or by a cartel upon the manufacture, production or exportation of a product imported in a country which has caused or threatens to cause material injury to a domestic industry or retard the establishment of a domestic industry producing identical or like articles.

Anti-dumping duty

this special duty which is equal to the difference between the lower price of the dumped imported articles and the higher price of a like domestic product, is imposed in addition to the regular duty, to prevent the continuous dumping of imported articles into the local market of a country at a price less than those prevailing in its domestic markets, which has the effect of causing material injury or threatening to retard the establishment of a domestic industry producing the same product.

A tariff is a schedule or system of duties imposed on goods as they are imported or exported, designed to regulate trade and protect domestic industries. Customs, on the other hand, refers to the actual duties or taxes collected by a country's customs authority when goods cross its borders, based on the tariff schedule.

(Suppose a private individual imports a car from Japan into the Philippines. The Bureau of Customs will calculate the customs duties based on the car's assessed value, typically using a combination of the tariff rate and any applicable taxes such as the excise tax. If the tariff rate is 30%, and the car's value is PHP 1,000,000, the customs duty would be PHP 300,000.)

Differentiate Tariff and Customs