Legal Definitions - antidumping tariff

Definition: An antidumping tariff is a tax imposed by a government on imported goods that are sold at a lower price than their fair market value. This is done to protect domestic industries from unfair competition and to prevent foreign companies from flooding the market with cheap goods.

Example: Let's say that a foreign company is selling steel in the United States at a price that is much lower than what American steel companies are charging. This could be because the foreign company is receiving subsidies from its government, or because it is selling steel below cost in order to drive American companies out of business. To level the playing field, the U.S. government might impose an antidumping tariff on the imported steel, making it more expensive for the foreign company to sell its product in the U.S.

Explanation: The example illustrates how an antidumping tariff can be used to protect domestic industries from unfair competition. By imposing a tax on imported goods that are being sold at an artificially low price, the government can help to ensure that domestic companies are able to compete on a level playing field. This can help to preserve jobs and prevent foreign companies from dominating the market.