A tariff may have only one of these two objectives – revenue or protection.
Frédéric Bastiat
Complete Works, Volume 7, pages 143 to 147 (in French)
Courrier français, August 22nd, 1846
Frédéric Bastiat is reacting here to an article published in La Presse further to the tariffs reform of 1846 in the United States. This reform was key to the extent that its objective was to suppress the existing protective tariffs (Frédéric Bastiat quotes the Boston Atlas demanding a reversion to the 1842 tariffs in order to protect national industry and labour) and to replace them with tariffs offering maximised revenues to the Treasury.
Today’s quote reminds us what the objectives of tariffs can be and Frédéric Bastiat explains in his letter what is the difference between fiscal tariffs and protective tariffs. He reminds us that liberals oppose the latter, which constitute a source of injustice, without delving into the former, which are legitimate to the extent that governments do need to find ressources indeed in order to operate. He praises the switch from tariffs applicable “per piece, according to weight or measurement” towards a tariff ad valorem. He also explains why a tariff applicable to things that are not produced in the importing country are far more legitimate than tariffs distorting competition between the home country and foreign producers.