Tariff
A tariff is a tax on imports or exports between sovereign states. It is a form of regulation of foreign trade. It is a policy that taxes foreign products to encourage or protect domestic industry. It helps limit trade deficits. The tariff is historically used to protect infant industries and to allow import substitution industrialization.
Tariff-rate quota
A tariff-rate quota (TRQ) is a two-tiered international trade tariff that combines two policy instruments used historically to protect domestic production by restricting imports−Import quotas and tariffs. The quotas set a quantitative threshold for a designated time period for imports of a protected domestic product. Under that threshold, tariffs applied to imports are either very low or nonexistent. Over that threshold, imports are subject to a significantly higher tariff that is intentionally prohibitive. TRQs have been required by the World Trade Organization (WTO) since the 1995 Uruguay Round Agreement 123 contract party nations engaged in international trade.