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Why Britain attempted to Tax American Colonists


The attempts by Britain to tax its North American colonists led to arguments, war, the expulsion of British rule and the creation of a new nation. The origins of these attempts lay, not in a rapacious government, but in the aftermath of the Seven Years War. Britain was and attempting to both balance finances – through tax - and control the newly acquired parts of their empire, through asserting sovereignty. These actions were complicated by British prejudice.

The Need for Defence

During the Seven Years War Britain had won a string of major victories and expelled France from North America, as well as parts of Africa, India and the West Indies. ‘New France’, the name of France’s North American holdings, was now British, but a newly conquered population could cause problems. Few people in Britain were naïve enough to believe that these former French colonists would suddenly and wholeheartedly embrace British rule with no danger of rebellion, and Britain believed troops would be needed to keep order. In addition, the war had revealed that the existing colonies needed defence against Britain’s enemies, and Britain believed that defence was best provided by the fully trained regular army, not just colonial militias. To this end, the post-war government of Britain, with a major lead taken by King George III, decided to permanently station units of the British army in America. Keeping this army would take money.

There was a political impetus behind this need. The Seven Years War had seen the British army expand from around 35,000 to over 100,000 men under arms, and opposition politicians in Britain now expected the army to decrease in number during peacetime. But, as well as needing more troops to garrison a suddenly enlarged empire, the government feared having to pension off masses of the officers, who were closely connected to politicians.

The Need for Tax

The Seven Years War had seen Britain spend prodigious amounts, both on its own army and on subsidies to allies. The British national debt had doubled in that short time, and extra taxes had been levelled in Britain. The last one, the Cider Tax, had proved highly unpopular and many people were agitating to have it removed. Britain was also running short of credit with banks. Under huge pressure to curb spending, the British King and government believed that any further attempts to tax the homeland would fail. They thus seized upon other sources of income, and one of these was taxing the American colonists in order to pay for the army protecting them.

The American colonies appeared to the British government to be heavily under taxed. Before the war the most colonists had directly contributed to British income was customs revenue, but this barely challenged the cost of collecting it. During the war huge sums of British currency had flooded into the colonies, and many not killed in the war, or in conflicts with natives, had done rather well. It appeared to the British government that a few new taxes to pay for their garrison should be easily absorbed. Indeed, they had to be absorbed, because there simply didn’t seem to be any other way of paying for the army. Few in Britain expected the colonists to have protection and not pay for it.

Unchallenged Assumptions

British minds first turned to taxing the colonists in 1763. Unfortunately for King George III and his government, their attempt to transform the colonies politically and economically into a safe, stable and revenue producing – or at least revenue balancing – part of their new empire would flounder, because the British failed to understand either the post-war nature of the Americas, the experience of war for the colonists, or how they would respond to tax demands. The colonies had been founded under crown / government authority, in the name of the monarch, and there had never been any exploration of what this really meant, and what power the crown had in America. While the colonies had become almost self governing, many in Britain assumed that as they sent governors to the colonies, legislated for them in British parliament, had a veto over colonial laws and because the colonies largely followed British law, that the British state had rights over the Americans.

No one in the decision making heart of government appears to have asked if colonial troops could have garrisoned America, or if Britain should ask the colonists for financial aid instead of voting in taxes above their heads. This was partly the case because the British government thought it was learning a lesson from the French-Indian War: that the colonial government would only work with Britain if they could see a profit, and that colonial soldiers were unreliable and undisciplined because they operated under rules different to the British army. In fact, these prejudices were based on British interpretations of the early part of the war, where co-operation between the politically poor British commanders and the colonial governments had been tense, if not hostile. But these views ignored the adaptations of the colonies in the final years, when they had born 3/5 of the costs, provided as many troops as asked for, and generally came together to fight a common enemy and achieved victory. The Briton who had overseen such a partnership, Pitt, was now out of power, and refused to come back.

The Issue of Sovereignty

Britain responded to these new, but false, assumptions about the colonies by wishing to expand British control and sovereignty over America, and these demands contributed another aspect to the British desire to levy taxes. In Britain it was felt that the colonists were outside the responsibilities which every Briton had to bear, and that the colonies were too far removed from the core of British experience to be left alone. By extending the duties of the average Briton to the US – including tax – the whole unit would be better off.

The British believed sovereignty was the sole cause of order in politics and society, that to deny sovereignty, to reduce or split it, was to invite anarchy and bloodshed. To view the colonies as separate from British sovereignty was, to contemporaries, to imagine a Britain dividing itself into rival units, and possible warfare between them. Britons dealing with the colonies frequently acted out of fear of reducing the crown’s powers when faced with the choice of levying tax or acknowledging limits.

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