Here's What Tariffs Are And How They Work

Tariffs are in the news at the moment. Here's what they are and what you need to know about them:

Tariffs are a tax on imports

Tariffs are typically charged as a percentage of the price a buyer pays a foreign seller. In the United States, tariffs are collected by Customs and Border Protection agents at 328 ports of entry across the country.

U.S. tariff rates vary: They are generally 2.5 on passenger cars, for instance, and 6 on golf shoes. Tariffs can be lower for countries with which the United States has trade agreements. Before the U.S. began imposing 25 tariffs on good from Canada and Mexico as of Tuesday, most goods moved between the United States and those countries tariff-free because of President Donald Trump's U.S.-Mexico-Canada trade agreement.

Mainstream economists are generally skeptical about tariffs, considering them an inefficient way for governments to raise revenue.