Specific tariff
Also called: Specific duty · Topic: International Trade Policy, WTO and Intellectual Property · NCERT: Beyond NCERT
Meaning
A specific tariff is a fixed amount of duty per physical unit of an import, such as per kg, per litre or per piece. It does not depend on the good's price, so it is easy to administer. It gives more protection when world prices fall, because the duty becomes a bigger share of a cheaper good. But it loses value with inflation, unlike an ad valorem tariff.
Example
A specific tariff of ₹50 per kg on an imported product means 200 kg pays ₹10,000 in duty. The duty is the same whether each kg costs ₹100 or ₹1,000.
Don't confuse with
- Ad valorem tariff: this is a fixed percentage of value (for example, 20% on a ₹1,000 good = ₹200). So it rises and falls with the price, while a specific tariff stays fixed per unit.
Related concepts
- Tariff
- Ad valorem tariff
- Compound tariff
- Mixed tariff
- Export duties
- Duty drawback
- Tariff escalation
- Tariff peak
- Effective rate of protection
- Bound tariff rate