Precisely, Net income leads to funny bookkeeping to game the system. The goal of gross income forces companies to be efficient and with only wages and salaries

Precisely, Net income leads to funny bookkeeping to game the system. The goal of gross income forces companies to be efficient and with only wages and salaries as deductions, not at the expense of employees. Trade tariffs can be applied in a similar manner. In the usual case, tariffs are based on the worst performing internal supplier, not on the best performing (most efficient) internal supplier. As efficiencies are gained by all, the tariffs themselves can come down. If the most efficient internal supplier gets less efficient, the tariffs do not increase to offset this decrease in efficiency. hence, they are forced to maintain or increase efficiency.