Distortion of international trade by selective indirect taxes and import charges

Taxes on international trade are highly favoured by the developing countries, because they generate about a third of the tax revenue with limited administrative costs. Import tariffs penalize consumers, promote inefficient patterns of production and implicitly tax exports.

1. Non-tariff barriers to international trade
2. Distortionary tax systems
3. Distorting effects of commodity taxes on the transaction of goods and nonfactor services

1. Ineffective economic structures in industrial nations

1. Vulnerability of economies to import penetration

1. Selective
2. Distortion