The Key Difference Between Import Duty and Export Duty

Import Duty vs Export Duty
Feature	Import Duty	Export Duty
Definition	Tax levied on goods brought into a country from abroad.	Tax imposed on goods shipped out of a country to foreign markets.
Purpose	Protect domestic industries, raise government revenue, control imports.	Control export volumes, protect domestic supply, increase government revenue.
Impact on Prices	Increases the cost of imported goods for consumers and businesses.	Can increase prices of exported goods, affecting competitiveness abroad.
Effect on Trade Balance	May reduce import volumes, improve trade balance.	May restrict exports, potentially worsening trade balance.
Application	Applied at the point of entry/customs on imported products.	Applied at customs on goods leaving the country.
Types	Ad valorem (percentage), specific (fixed amount), or compound duties.	Ad valorem or specific duties depending on the product.
Economic Effect	Protects local industries by making imports more expensive.	Controls resource depletion or supply shortages by limiting exports.
Revenue Generation	Source of government revenue from imports.	Source of government revenue from exports.
Impact on Consumers	Higher prices for imported goods, less variety sometimes.	May indirectly affect domestic prices if export taxes increase costs.
Impact on Producers	Domestic producers gain protection from foreign competition.	Exporters face higher costs, possibly reducing profit margins.
Policy Use	Used to promote import substitution and protect emerging industries.	Used to conserve scarce resources or stabilize domestic markets.
International Relations	Can lead to trade disputes or retaliation if too high.	May affect trade agreements or cause friction with trading partners.
Examples in India	Import duty on electronics, automobiles, luxury goods.	Export duty on iron ore, certain agricultural products.
Exemptions	Often exempt for essential goods, raw materials, or under trade agreements.	Sometimes exempted to encourage exports of strategic products.
Administration	Collected by customs at ports of entry.	Collected by customs at ports of exit.
Effect on Supply Chain	May cause delays and increase logistics costs due to customs procedures.	Can complicate export logistics and pricing strategies.