What are tariffs?

Tariffs are defined as taxes imposed on imported goods. They serve multiple purposes, such as protecting domestic industries from foreign competition, generating revenue for the government, and influencing trade balances. By making imported goods more expensive, tariffs can encourage consumers to buy products made locally, thus benefiting domestic manufacturers. This economic tool is often used by governments to regulate trade and can be a significant aspect of trade policy.

The other options do not accurately reflect the definition of tariffs. Subsidies for local businesses refer to financial support provided by the government to help domestic industries, while fees for exporting products are costs incurred by sellers seeking to send goods abroad. Regulations on trade agreements are rules that guide how countries interact with each other regarding trade but do not specifically pertain to taxes on imports.