A History of Tax Law, Chapter Eight: Taxes and The Boston Tea Party
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
Ah…. now we have an event in history obviously about abusive taxes. Was the Boston Tea Party a protest against the British tax on tea, as we were all taught? No, not at all. The colonies had continuously been boycotting English tea for 5 years before to the Boston Tea Party! They had instead smuggled in Dutch tea and were doing quite well. There was tea for all and no British tea tax paid. Naturally, the British did not like the boycott. So, the British bypassed the duties back home. The Parliament told British tea sellers to disregard the import tax of shipping the tea into England and then pass the savings along to the colonies when they shipped the tea over and then sold British tea at a price that was lower than the smuggled Dutch tea. If you're feeling the pressure with today's taxes, call a CPA for Tax Preparation in Raleigh, NC for all your tax-related needs!
But who would sell this British tea?
They did it through loyal British merchants in the colonies. But would the colonists buy the cheaper British tea even though it included a tax? Yes. They bought so much that what ended up happening was loyal British merchants were getting all the business and a tax was still be paid to England. However, the colonists did not care about the tax very much; they ended up receiving more inexpensive tea. However, the non-British MERCHANTS did not enjoy this gig. The British merchants, with the assistance of England, had basically created a monopoly on tea sales. The colony merchants feared it was only a matter of time before many British enterprises would be established with the same mechanism and they would be forced out of business. Go here if you want help with a modern-day Tax Return in Raleigh, NC.
So, a group of MERCHANTS who appeared to be Indians, walked on a boat loaded with British tea and dumped it into the water. Was this a crowning peak in American tax protest? No, it was not. The Boston Tea Party was looked at as the wanton desecration of private property at a time when private property was highly regarded. The Boston Tea Party was extremely looked down upon and did not sit well with the colonists. Ben Franklin was abhorred and told the merchants that full repayment would be given immediately to the owners of the tea. Anyway, it turned into war.
However, the colonies would soon find that masses of warships, legions of redcoats, and cannons were a lot more terrifying than a few tax collectors. The ironic thing is, America didn't lose the war, mostly due to the fact that England found it too expensive to fund war so far from England. BUT after the war, America faced astounding debts and taxes, and even with representation they were enormous.
Keep an eye out for W. Marc Gilfillan's next chapter in his History of Taxes series: Taxes and Slavery and the Civil War.
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