Tariffs, explained: How they work and why they matter

Tariffs have been a robust tool in the hands of governments to shield domestic manufacturers and penalize unfair trade practices outside borders.

Tariffs are taxes placed on imported goods by a government or a supranational union. Occasionally, tariffs can be applied to exports as well. They generate government revenue and serve as a trade regulation tool, often to shield domestic industries.

Four main categories of tariffs are:

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