In businesss Trade policy bring under control what
Answers
The government’s trade policy can affect your business by making it easier or more difficult to trade across international borders.
Trade policy can include the imposition of import tariffs, quotas on imports and exports of certain goods, and subsidies for local producers to support them against international competition. Governments often enter into bilateral trade agreements with other countries, with the aim of reducing tariffs and barriers to business and establishing a free trade area or common market. This can be helpful to some businesses, but can also lead to increased competition from abroad.
Barriers may also be increased in the form of trade sanctions or an embargo against another country.
How will the government’s economic policy affect my business?
The government’s economic policies have a number of implications for your business. The government’s economic policy will affect your business directly via taxes and interest rates, and indirectly via public spending.
Tax laws can increase or decrease the amount of tax you have to pay, and therefore will change your net profit. Special rules or exemptions may affect certain business sectors. Tax regulations can become very complex, causing you to hire a specialist tax adviser. Higher interest rates will increase what you’ll have to pay to borrow money. Both tax and borrowing policies will also affect the income of your customers, which could have an indirect impact on your sales.
Government spending on infrastructure such as roads could help your business on a practical level, and investments in education could improve the quality of the available labour force.