American Revolution and War for Independence

The first step in inaugurating the new system was the passage of the Sugar Act of 1764. This was designed to raise revenue without regulating trade. In fact, it replaced the Molasses Act of 1733, which had placed a prohibitive duty on the import of rum and molasses from non-English areas. The amended Sugar Act forbade the importation of foreign rum; put a modest duty on molasses from all sources; and levied duties on wines, silks, coffee, and a number of other luxury items. To enforce it, customs officials were ordered to show more energy and strictness. British warships in American waters were instructed to seize smugglers, and "writs of assistance" (blanket warrants) authorized the King's officers to search suspected premises.

5. Tax dispute

It was not so much the new duties that caused consternation among New England merchants. It was rather the fact that steps were being taken to enforce them effectively, an entirely new development. For over a generation, New Englanders had been accustomed to importing the larger part of the molasses for their rum distilleries from the French and Dutch West Indies without paying a duty. They now contended that payment of even the small duty imposed would be ruinous.

As it happened, the preamble to the Sugar Act gave the colonists an opportunity to rationalize their discontent on constitutional grounds. The power of Parliament to tax colonial commodities for the regulation of trade had long been accepted in theory though not always in practice, but the power to tax "for improving the revenue of this Kingdom," as stated in the Revenue Act of 1764, was new and hence debatable.

The constitutional issue became an entering wedge in the great dispute that was finally to wrest the American colonies from England. "One single act of Parliament," wrote James Otis, fiery orator from Massachusetts, "has set more people a-thinking in six months, more than they had done in their whole lives before." Merchants, legislatures, and town meetings protested against the expediency of the law, and colonial lawyers like Samuel Adams found in the preamble the first intimation of "taxation without representation," the catchword that was to draw many to the cause of the American patriots against the mother country.

Later in the same year, Parliament enacted a Currency Act "to prevent paper bills of credit hereafter issued in any of His Majesty's colonies from being made legal tender." Since the colonies were a deficit trade area and were constantly short of "hard money," this added a serious burden to the colonial economy. History of American Money equally objectionable from the colonial viewpoint was the Billeting Act, passed in 1765, which required colonies to provide quarters and supplies for royal troops.

Strong as was the opposition to these acts, it was the last of the measures inaugurating the new colonial system that sparked organized resistance. Known to history as the “Stamp Act”, it provided that revenue stamps be affixed to all newspapers, broadsides, pamphlets, licenses, leases, or other legal documents, the revenue (collected by American agents) to be used for "defending, protecting, and securing" the colonies. The burden seemed so evenly and lightly distributed that the measure passed Parliament with little debate.

The violence of the reaction in the thirteen colonies, however, astonished moderate men everywhere. The act aroused the hostility of the most powerful and articulate groups in the population, journalists, lawyers, clergymen, merchants, and businessmen, north and south, east and west, for it bore equally on all sections of the country. Soon leading merchants, whose every bill of lading would be taxed, organized for resistance and formed non-importation associations.

Trade with the mother country fell off sharply in the summer of 1765. Prominent men organized as "Sons of Liberty," and political opposition soon flared into rebellion. Inflamed crowds paraded the streets of Boston. From Massachusetts to South Carolina the act was nullified, and mobs, forcing luckless agents to resign their offices, destroyed the hated stamps.Spurred by Patrick Henry, the Virginia Assembly passed a set of resolutions denouncing taxation without representation as a threat to colonial liberties. A few days later, the Massachusetts House invited all the colonies to appoint delegates to a Congress in New York to consider the Stamp Act menace. This Congress, held in October 1765, was the first inter-colonial meeting ever summoned on American initiative. Twenty-seven men from nine colonies seized the opportunity to mobilize colonial opinion against parliamentary interference in American affairs. After much debate, the Congress adopted a set of resolutions asserting that "no taxes ever have been or can be constitutionally imposed on them, but by their respective legislatures" and that the Stamp Act had a "manifest tendency to subvert the rights and liberties of the colonists."

6. Abatement of tax disputes

The issue thus drawn centered on the question of representation. From the colonies' point of view, it was impossible to consider themselves represented in Parliament unless they actually elected members to the House of Commons. But this conflicted with the orthodox English principle of “virtual representation”, that is, representation by classes and interests rather than by locality.

Most British officials held that Parliament was an imperial body representing and exercising the same authority over the colonies as over the homeland: It could pass laws for Massachusetts as it could for Berkshire in England.

The American leaders argued that no "imperial" Parliament existed; their only legal relations were with the Crown. It was the King who had agreed to establish colonies beyond the sea and the King who provided them with governments. That the King was equally a King of England and a King of Massachusetts they agreed, but they also insisted that the English Parliament had no more right to pass laws for Massachusetts than the Massachusetts legislature had to pass laws for England.

The British Parliament was unwilling to accept the colonial contentions. British merchants, however, feeling the effects of the American boycott, threw their weight behind a repeal movement, and in 1766 Parliament yielded, repealing the Stamp Act and modifying the Sugar Act. The colonies rejoiced. Colonial merchants gave up the non-importation agreement, the Sons of Liberty subsided, trade resumed its course, peace seemed at hand.

But it was only a respite. The year 1767 brought another series of measures that stirred anew all the elements of discord. Charles Townshend, British Chancellor of the Exchequer, was called upon to draft a new fiscal program. Intent upon reducing British taxes by making more efficient the collection of duties levied on American trade, he tightened customs administration, at the same time sponsoring duties on paper, glass, lead, and tea exported from Britain to the colonies.

This was designed to raise revenue to be used in part to support colonial governors, judges, customs officers, and the British army in America. Another act suggested by Townshend authorized the superior courts of the colonies to issue writs of assistance, thus giving specific legal authority to the general search warrants already hateful to the colonists.