The U. S. government imposes a 25 percent tax on the selling price of any four-wheel-drive SUV that is brought into the U. S. by a foreign car manufacturer to be sold in the U. S. What type of tax is the U. S. government imposing?

An import tarif

Explanation:

An import tariff is a type of tax levied on the product bought from foreign nations. Tariff restricts the volume of goods and services brought into the country and making them expensive in the local market. Import tariffs serve as a source of revenue to the government and protect locally manufactured goods from unfair competition by imports.

The 25 percent tax imposed on all SUVs is an example of an import tariff. The person of the firm importing the vehicle must pat the government an amount equivalent to 25 percent of the value of SUV. Import tariffs make importing unattractive, thereby encouraging the consumption of domestic products.

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