What are Countervailing Duties?

Written by Bonita Fowlersmith

Updated at May 9th, 2025

What are Countervailing Duties?

Countervailing duties (CVD) are special import tariffs imposed by a country to counteract subsidies provided by foreign governments to their exporters. These subsidies can take many forms, such as direct cash payments, tax breaks, or other financial support, allowing exporters to sell their goods at artificially low prices, potentially harming domestic industries in the importing country.

Why are countervailing duties imposed?

When an investigation determines that imported goods are benefiting from unfair subsidies and that these imports are causing or threatening to cause injury to the domestic industry, countervailing duties are imposed. The goal is to "level the playing field" by offsetting the advantage that foreign producers receive from their government subsidies.

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