Tariff Policy

the sphere of foreign-trade policy that regulates the volume, structure, and terms of the export and import of goods. In capitalist states in the 17th and 18th centuries, tariff policy, reflecting the interests of the commercial bourgeoisie, sought to ensure an active balance of trade. High customs duties, which also served to raise revenue, were used to limit imports (see alsoMERCANTILISM). Beginning in the late 18th century, as industrial capitalism developed, high protective tariffs were introduced to encourage the growth of national industry.

In the era of imperialism, tariff policy has been employed by monopolies in their competition for sales outlets and for capital investment spheres, as well as in the state-monopoly regulation of the economy. In the 1930’s and 1940’s, as a result of the world crises of overproduction (1929–33 and 1937–38), tariff policy became super-protectionist and led to a rise in import duties (see alsoPROTECTIONISM). In the first years after World War II (1939–45), Western European countries aimed at lowering tariff barriers, since the countries were suffering from severe shortages of consumer goods and equipment needed to restore the economy. The recovery of Western European countries after the war, the growth of industrial production, and difficulties that had arisen in the sale of domestic goods led to various rigid tariff barriers.

Imperialist powers today combine measures of aggressive protectionism and economic expansionism in their tariff policy. At the same time, they adapt their policy to the changing world situation, notably the growth of the economic power and influence of world socialism, the economic advances of developing countries, and the development of international economic cooperation.

Tariff policy became more flexible in many capitalist countries in the late 1960’s and early 1970’s. Duties on certain imported industrial and agricultural goods were somewhat reduced, and traditional tactics used against socialist and developing countries were discontinued, for example, trade embargoes, tariff wars, and tariff discrimination. The Federal Republic of Germany, for instance, instituted a more liberal policy toward socialist states and between 1970 and 1975 concluded long-term trade agreements or agreements on economic cooperation with most of them. The USA maintains a discriminatory tariff policy toward the USSR, based on the trade laws adopted by Congress in December 1974.

At the same time, the exacerbation of contradictions among imperialist powers, under conditions of the economic crisis afflicting all capitalist countries, and chronic inflation have led to more rigid customs policies and protectionist and super-protectionist measures in the competition for supremacy in the world market. Thus Canada, in December 1974, introduced protectionist limitations on the import of meat products from the USA, and the USA retaliated by introducing a strict quota on the import of similar products from Canada. Canada suffered losses of more than $100 million, while American losses were ten times less. In 1975, the USA responded to an increase in the price of oil by the Organization of Petroleum Exporting Countries by depriving member states of preferential tariffs.

The tariff policy of developing countries, distinctly protectionist in nature, is aimed at ensuring economic and political independence and strengthening and developing the national economy. Minimum rates are imposed on imported machines and equipment, chemical products, and metals; agricultural products are usually imported duty-free. Higher rates are imposed on clothing and household items, while maximum rates are imposed on luxury items and alcoholic beverages.

The tariff policy of socialist countries is intended to guarantee the equality of each party in international trade agreements and to ensure that agreements are beneficial to each party. Policies among socialist countries take into account the interests of each country and the interests of the socialist community as a whole. They encourage socialist cooperation, the cultivation of closer economic ties, the equalization of economic development in various socialist countries, and the strengthening of the world system of socialist economy. The tariff policy of socialist countries toward the developing countries of Asia, Africa, and Latin America is aimed at freeing trade relations from the unfair discriminatory norms initiated in the age of colonial rule and maintained by modern capitalist monopolies. Socialist tariff policy facilitates the economic growth of states that have begun developing independently.