Saturday, May 6, 2017

What is Preferential Tariff System

A tariff schedule under which one or more nations are given lower rates or other advantages over others. That is one country will give a traffic reduction facilities to other country.
A preferential tariff system can be applied to certain goods from certain specified countries and groups of countries.
The parties to a system of preferential tariffs levy lower rates of duty on imports from one another than they do on imports from third countries.
A tariff which imposes lower rates of duty on goods imported from some countries.
This facility is enhanced and privileged by the membership of World Trade Organization (WTO).
In summary it's a comfort zone for two or more countries how the would like to prefer tariff for export-import.

Qualifying for Preferential Tariff System
To qualify for preferential tariff treatment, imported goods must satisfy all the specific requirements that are applicable to the preferential country or country group in which the goods were produced or manufactured. As a general rule, the goods must:
(a) satisfy the rules of origin applicable to the particular preferential country or country group; and
(b) comply with all other relevant requirements applicable to the particular preferential country or
country group (eg, direct shipment). The rules of origin set out the criteria for determining whether imported goods are to be treated as being the produce or manufacture of a particular preferential country or country group.