3. Economic role of rates

A property tax (or millage tax) is a levy on property that the owner is required to pay. The tax is levied by the governing authority of the jurisdiction in which the property is located; it may be paid to a national government, a federated state, a county/region, or a municipality. Multiple jurisdictions may tax the same property.

There are four broad types of property: land, improvements to land (immovable man-made objects, such as buildings), personal property (movable man-made objects), and intangible property. Real property (also called real estate or realty) means the combination of land and improvements. Under a property tax system, the government requires and/or performs an appraisal of the monetary value of each property, and tax is assessed in proportion to that value. Forms of property tax used vary among countries and jurisdictions.

A special assessment tax is sometimes confused with property tax. These are two distinct forms of taxation: one (ad valorem tax) relies upon the fair market value of the property being taxed for justification, and the other (special assessment) relies upon a special enhancement called a "benefit" for its justification.

The property tax rate is often given as a percentage. It may also be expressed as a per mil (amount of tax per thousand currency units of property value), which is also known as a millage rate or mill is also one-thousandth of a currency unit.) To calculate the property tax, the authority will multiply the assessed value of the property by the mill rate and then divide by 1,000. For example, a property with an assessed value of $50,000 located in a municipality with a mill rate of 20 mills would have a property tax bill of $1,000 per year.

Theme of the lecture № 5.

Non-tariff methods of regulation of foreign trade

1. The essence of Non-Tariff Barriers

2. Types of Non-Tariff Barriers

3. Licenses and Quotas

1. The essence of Non-Tariff Barriers

Non-tariff barriers to trade (NTBs) are trade barriers that restrict imports but are not in the usual form of a tariff. Some common examples of NTB's are anti-dumping measures and countervailing duties, which, although called non-tariff barriers, have the effect of tariffs once they are enacted.

Their use has risen sharply after the WTO rules led to a very significant reduction in tariff use. Some non-tariff trade barriers are expressly permitted in very limited circumstances, when they are deemed necessary to protect health, safety, sanitation, or depletable natural resources. In other forms, they are criticized as a means to evade free trade rules such as those of the World Trade Organization (WTO), the European Union (EU), or North American Free Trade Agreement (NAFTA) that restrict the use of tariffs.

Some of non-tariff barriers are not directly related to foreign economic regulations but nevertheless have a significant impact on foreign-economic activity and foreign trade between countries.

Trade between countries is referred to trade in goods, services and factors of production. Non-tariff barriers to trade include import quotas, special licenses, unreasonable standards for the quality of goods, bureaucratic delays at customs, export restrictions, limiting the activities of state trading, export subsidies, countervailing duties, technical barriers to trade, sanitary and phyto-sanitary measures, rules of origin, etc. Sometimes in this list they include macroeconomic measures affecting trade.

Six Types of Non-Tariff Barriers to Trade:

1. Specific Limitations on Trade:

   1. Quotas

   2. Import Licensing requirements

   3. Proportion restrictions of foreign to domestic goods (local content requirements)

   4. Minimum import price limits

   5. Embargoes

2. Customs and Administrative Entry Procedures:

   1. Valuation systems

   2. Anti-dumping practices

   3. Tariff classifications

   4. Documentation requirements

   5. Fees

3. Standards:

   1. Standard disparities

   2. Intergovernmental acceptances of testing methods and standards

   3. Packaging, labeling, and marking

4. Government Participation in Trade:

   1. Government procurement policies

   2. Export subsidies

   3. Countervailing duties

   4. Domestic assistance programs

5. Charges on imports:

   1. Prior import deposit subsidies

   2. Administrative fees

   3. Special supplementary duties

   4. Import credit discrimination

   5. Variable levies

   6. Border taxes

6. Others:

   1. Voluntary export restraints

   2. Orderly marketing agreements

Non-tariff barriers to trade can be the following:

• Import bans

• General or product-specific quotas

• Rules of Origin

• Quality conditions imposed by the importing country on the exporting countries

• Sanitary and phytosanitary conditions

• Packaging conditions

• Labeling conditions

• Product standards

• Complex regulatory environment

• Determination of eligibility of an exporting country by the importing country

• Determination of eligibility of an exporting establishment (firm, company) by the importing country.

• Additional trade documents like Certificate of Origin, Certificate of Authenticity etc.

• Occupational safety and health regulation

• Employment law

• Import licenses

• State subsidies, procurement, trading, state ownership

• Export subsidies

• Fixation of a minimum import price

• Product classification

• Quota shares

• Foreign exchange market controls and multiplicity

• Inadequate infrastructure

• "Buy national" policy

• Over-valued currency

• Intellectual property laws (patents, copyrights)

• Restrictive licenses

• Seasonal import regimes

• Corrupt and/or lengthy customs procedures