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The Tea Act 1773 (13 Geo 3 c 44) was an Act of the
Parliament of Great Britain The Parliament of Great Britain was formed in May 1707 following the ratification of the Acts of Union by both the Parliament of England and the Parliament of Scotland. The Acts ratified the treaty of Union which created a new unified Kingdo ...
. The principal objective was to reduce the massive amount of tea held by the financially troubled
British East India Company The East India Company (EIC) was an English, and later British, joint-stock company founded in 1600 and dissolved in 1874. It was formed to trade in the Indian Ocean region, initially with the East Indies (the Indian subcontinent and South ...
in its
London London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...
warehouses and to help the struggling company survive. A related objective was to undercut the price of illegal tea, smuggled into Britain's North American colonies. This was supposed to convince the colonists to purchase Company tea on which the Townshend duties were paid, thus implicitly agreeing to accept Parliament's right of taxation. Smuggled tea was a large issue for Britain and the East India Company, since approximately 86% of all the tea in America at the time was smuggled Dutch tea. The Act granted the Company the right to directly ship its tea to North America and the right to the duty-free export of tea from Britain, although the tax imposed by the Townshend Acts and collected in the colonies remained in force. It received the
royal assent Royal assent is the method by which a monarch formally approves an act of the legislature, either directly or through an official acting on the monarch's behalf. In some jurisdictions, royal assent is equivalent to promulgation, while in oth ...
on May 10, 1773. Colonists in the
Thirteen Colonies The Thirteen Colonies, also known as the Thirteen British Colonies, the Thirteen American Colonies, or later as the United Colonies, were a group of British colonies on the Atlantic coast of North America. Founded in the 17th and 18th centu ...
recognized the implications of the Act's provisions, and a coalition of merchants, smugglers, and artisans similar to that which had opposed the
Stamp Act 1765 The Stamp Act 1765, also known as the Duties in American Colonies Act 1765 (5 Geo. III c. 12), was an Act of the Parliament of Great Britain which imposed a direct tax on the British colonies in America and required that many printed materials ...
mobilized opposition to the delivery and distribution of the tea. The company's authorised consignees were harassed, and in many colonies, successful efforts were made to prevent the tea from being landed. In
Boston Boston (), officially the City of Boston, is the state capital and most populous city of the Commonwealth of Massachusetts, as well as the cultural and financial center of the New England region of the United States. It is the 24th- mo ...
, this resistance culminated in the
Boston Tea Party The Boston Tea Party was an American political and mercantile protest by the Sons of Liberty in Boston, Massachusetts, on December 16, 1773. The target was the Tea Act of May 10, 1773, which allowed the British East India Company to sell t ...
on December 16, 1773, when colonists (some disguised as Native Americans, since they identified themselves as "Americans" and no longer considered themselves British subjects) boarded tea ships anchored in the harbour and dumped their tea cargo overboard. Parliamentary reaction to this event included the passage of the Coercive Acts, designed to punish Massachusetts for its resistance, and the appointment of General
Thomas Gage General Thomas Gage (10 March 1718/192 April 1787) was a British Army general officer and colonial official best known for his many years of service in North America, including his role as British commander-in-chief in the early days of t ...
as royal governor of Massachusetts. These actions further raised tensions that led to the eruption of the
American War of Independence The American Revolutionary War (April 19, 1775 – September 3, 1783), also known as the Revolutionary War or American War of Independence, was a major war of the American Revolution. Widely considered as the war that secured the independence of t ...
in April 1775. Parliament passed the
Taxation of Colonies Act 1778 The Taxation of Colonies Act 1778 was an Act of the Parliament of Great Britain under the order King George III that declared Parliament would not impose any duty, tax, or assessment for the raising of revenue in any of the colonies of British A ...
, which
repealed A repeal (O.F. ''rapel'', modern ''rappel'', from ''rapeler'', ''rappeler'', revoke, ''re'' and ''appeler'', appeal) is the removal or reversal of a law. There are two basic types of repeal; a repeal with a re-enactment is used to replace the law ...
a number of taxes (including the tea tax that underlay this act) as one of a number of conciliatory proposals presented to the
Second Continental Congress The Second Continental Congress was a late-18th-century meeting of delegates from the Thirteen Colonies that united in support of the American Revolutionary War. The Congress was creating a new country it first named "United Colonies" and in 1 ...
by the
Carlisle Peace Commission The Carlisle Peace Commission was a group of British peace commissioners who were sent to North America in 1778 to negotiate terms with the rebellious Continental Congress during the American Revolutionary War. The commission carried an offer of ...
. The commission's proposals were rejected. The Act effectively became a "dead letter", but was not formally removed from the books until the passage of the Statute Law Revision Act 1861.


Background

In the 1760s and earlier the
East India Company The East India Company (EIC) was an English, and later British, joint-stock company founded in 1600 and dissolved in 1874. It was formed to trade in the Indian Ocean region, initially with the East Indies (the Indian subcontinent and Sou ...
had been required to sell its tea exclusively in London on which it paid a duty which averaged two shillings and six pence per pound.Ketchum, pg. 240 Tea destined for the North American colonies would be purchased by merchants specializing in that trade, who transported it to North America for eventual retail sale. The markups imposed by these merchants, combined with the tea tax imposed by the Townshend Acts of 1767 created a profitable opportunity for American merchants to import and distribute tea purchased from the Dutch in transactions and shipments that violated the Navigation Acts and were treated by British authorities as
smuggling Smuggling is the illegal transportation of objects, substances, information or people, such as out of a house or buildings, into a prison, or across an international border, in violation of applicable laws or other regulations. There are variou ...
. Smugglers imported some of cheap foreign tea per year. The quality of the smuggled tea did not match the quality of the dutiable East India Company tea, of which the Americans bought per year. Although the British tea was more appealing in flavor, some Patriots like the Sons of Liberty encouraged the consumption of smuggled tea as a political protest against the Townshend taxes. In 1770 most of the Townshend taxes were repealed, but taxes on tea were retained. Resistance to this tax included pressure to avoid legally imported tea, leading to a drop in colonial demand for the Company's tea and a burgeoning surplus of the tea in the company's English warehouses. By 1773 the Company was close to collapse due in part to contractual payments to the British government of £400,000 per year, together with war and a severe famine in
Bengal Bengal ( ; bn, বাংলা/বঙ্গ, translit=Bānglā/Bôngô, ) is a geopolitical, cultural and historical region in South Asia, specifically in the eastern part of the Indian subcontinent at the apex of the Bay of Bengal, predom ...
which drastically reduced the Company's revenue from India, and economic weakness in European markets.
Benjamin Franklin Benjamin Franklin ( April 17, 1790) was an American polymath who was active as a writer, scientist, inventor, statesman, diplomat, printer, publisher, and political philosopher. Encyclopædia Britannica, Wood, 2021 Among the leading int ...
was one of several people who suggested things would be greatly improved if the Company was allowed to export its tea directly to the colonies without paying the taxes it was paying in London: "to export such tea to any of the British colonies or plantations in America, or to foreign parts, import duty of three pence a pound." The administration of Lord North saw an opportunity to achieve several goals with a single bill. If the Company was permitted to directly ship tea to the colonies, this would remove the markups of the middlemen from the cost of its tea. Reducing or eliminating the duties paid when the tea was landed in Britain (if it was shipped onward to the colonies) would further lower the final cost of tea in the colonies, undercutting the prices charged for smuggled tea. Colonists would willingly pay for cheaper Company tea, on which the Townshend tax was still collected, thus legitimizing Parliament's ability to tax the colonies.


Provisions of the Act

The Act, which received the
royal assent Royal assent is the method by which a monarch formally approves an act of the legislature, either directly or through an official acting on the monarch's behalf. In some jurisdictions, royal assent is equivalent to promulgation, while in oth ...
on May 10, 1773, contained the following provisions: *The Company was eligible to be granted a license to export tea to North America. *The Company was no longer required to sell its tea at the
London Tea Auction The London Tea Auction was a candle auction of tea, that ran regularly for over 300 years from 1679 until its closure on 29 June 1998. The auction made London the centre for tea's international trade. The East India Company held the first auction ...
. *Duties on tea (charged in Britain) destined for North America "and foreign parts" would either be refunded on export or not imposed. *Consignees receiving the Company's tea were required to pay a deposit upon receipt of tea. Proposals were made that the Townshend tax also is waived, but North opposed this idea, citing the fact that those revenues were used to pay the salaries of crown officials in the colonies.


Implementation

The Company was granted a license by the North administration to ship tea to major American ports, including Charleston,
Philadelphia Philadelphia, often called Philly, is the largest city in the Commonwealth of Pennsylvania, the sixth-largest city in the U.S., the second-largest city in both the Northeast megalopolis and Mid-Atlantic regions after New York City. Since ...
,
New York City New York, often called New York City or NYC, is the List of United States cities by population, most populous city in the United States. With a 2020 population of 8,804,190 distributed over , New York City is also the L ...
, and
Boston Boston (), officially the City of Boston, is the state capital and most populous city of the Commonwealth of Massachusetts, as well as the cultural and financial center of the New England region of the United States. It is the 24th- mo ...
. Consignees who were to receive the tea and arrange for its local resale were generally favorites of the local governor (who was royally appointed in
South Carolina )''Animis opibusque parati'' ( for, , Latin, Prepared in mind and resources, links=no) , anthem = " Carolina";" South Carolina On My Mind" , Former = Province of South Carolina , seat = Columbia , LargestCity = Charleston , LargestMetro = ...
,
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, and
Massachusetts Massachusetts (Massachusett: ''Muhsachuweesut Massachusett_writing_systems.html" ;"title="nowiki/> məhswatʃəwiːsət.html" ;"title="Massachusett writing systems">məhswatʃəwiːsət">Massachusett writing systems">məhswatʃəwiːsət'' En ...
, and appointed by the proprietors in
Pennsylvania Pennsylvania (; ( Pennsylvania Dutch: )), officially the Commonwealth of Pennsylvania, is a state spanning the Mid-Atlantic, Northeastern, Appalachian, and Great Lakes regions of the United States. It borders Delaware to its southeast, ...
). In Massachusetts, Governor Thomas Hutchinson was a part-owner of the business hired by the Company to receive tea shipped to Boston.


Reaction

Many colonists opposed the Act, not so much because it rescued the East India Company, but more because it seemed to validate the Townshend Tax on tea. Merchants who had been acting as the middlemen in legally importing tea stood to lose their business, as did those whose illegal Dutch trade would be undercut by the Company's lowered prices. These interests combined forces, citing the taxes and the Company's monopoly status as reasons to oppose the Act. In New York and Philadelphia, opposition to the Act resulted in the return of tea delivered there back to Britain. In Charleston, the colonists left the tea on the docks to rot. Governor Hutchinson in Boston was determined to leave the ships in port, even though vigilant colonists refused to allow the tea to be landed. Matters reached a crisis when the time period for landing the tea and paying the Townshend taxes was set to expire, and on December 16, 1773, colonists disguised as Indians swarmed aboard three tea-laden ships and dumped their cargo into the harbour in what is now known as the
Boston Tea Party The Boston Tea Party was an American political and mercantile protest by the Sons of Liberty in Boston, Massachusetts, on December 16, 1773. The target was the Tea Act of May 10, 1773, which allowed the British East India Company to sell t ...
. Similar "Destruction of the Tea" (as it was called at the time) occurred in New York and other ports shortly thereafter, though Boston took the brunt of Imperial retaliation because it was the first "culprit".


Consequences

The Boston Tea Party appalled British political opinion makers of all stripes. The action united all parties in Britain against the American radicals. Parliament enacted the
Boston Port Act The Boston Port Act, also called the Trade Act 1774, was an Act of Parliament, Act of the Parliament of Great Britain which became law on March 31, 1774, and took effect on June 1, 1774. It was one of five measures (variously called the ''Intole ...
, which closed Boston Harbor until the dumped tea was paid for. This was the first of the so-called Coercive Acts, or Intolerable Acts as they were called by the colonists, passed by Parliament in response to the Boston Tea Party. These harsh measures united many colonists even more in their frustrations against Britain and were one of the many causes of the
American Revolutionary War The American Revolutionary War (April 19, 1775 – September 3, 1783), also known as the Revolutionary War or American War of Independence, was a major war of the American Revolution. Widely considered as the war that secured the independence of t ...
. The
Taxation of Colonies Act 1778 The Taxation of Colonies Act 1778 was an Act of the Parliament of Great Britain under the order King George III that declared Parliament would not impose any duty, tax, or assessment for the raising of revenue in any of the colonies of British A ...
repealed the tea tax and others that had been imposed on the colonies, but it proved insufficient to end the war. The Tea Act became a "dead letter" as far as the
Thirteen Colonies The Thirteen Colonies, also known as the Thirteen British Colonies, the Thirteen American Colonies, or later as the United Colonies, were a group of British colonies on the Atlantic coast of North America. Founded in the 17th and 18th centu ...
were concerned, and was formally removed from the books in 1861.


Notes


References

* Ketchum, Richard, ''Divided Loyalties, How the American Revolution came to New York'', 2002, * Unger, Harlow, ''John Hancock, Merchant King and American Patriot'', 200, {{Authority control 1773 in the Thirteen Colonies Laws leading to the American Revolution British East India Company Repealed Great Britain Acts of Parliament Great Britain Acts of Parliament 1773 Tea