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Sugar Act
The Sugar Act, also known as the American Revenue Act or the American Duties Act, was a revenue-raising act passed by the Parliament of Great Britain on April 5, 1764. The preamble to the act stated: "it is expedient that new provisions and regulations should be established for improving the revenue of this Kingdom ... and ... it is just and necessary that a revenue should be raised ... for defraying the expenses of defending, protecting, and securing the same."〔Miller pg. 101〕 The earlier Molasses Act of 1733, which had imposed a tax of six pence per gallon of molasses, had never been effectively collected due to colonial evasion. By reducing the rate by half and increasing measures to enforce the tax, the British hoped that the tax would actually be collected.〔Miller pg. 100-101〕 These incidents increased the colonists' concerns about the intent of the British Parliament and helped the growing movement that became the American Revolution.
==Background==
The Molasses Act of 1733 was passed by Parliament largely at the insistence of large plantation owners in the British West Indies. Molasses from French, Dutch, and Spanish West Indian possessions was inexpensive. Sugar (from the British West Indies) was priced much higher than its competitors and they also had no need for the large quantities of lumber, fish, and other items offered by the colonies in exchange. Sometimes colonists would pay Molasses Act taxes because they were rather low depending on where they resided and how much money they had. In the first part of the 18th Century, the British West Indies were Great Britain's most important trading partner, so Parliament was attentive to their requests. However, rather than acceding to the demands to prohibit the colonies from trading with the non-British islands, Parliament passed the prohibitively high tax on the colonies on molasses imported from those islands. If actually collected, the tax would have effectively closed that source to New England and destroyed much of the rum industry. Instead, smuggling, bribery or intimidation of customs officials effectively nullified the law.〔Miller pg. 96-99〕
During the Seven Years' War, known in Colonial America as the French and Indian War, the British government substantially increased the national debt to pay for the war. In February 1763, as the war ended, the ministry headed by John Stuart, the Earl of Bute, decided to maintain a standing army of ten thousand British regular troops in the colonies. Shortly thereafter, George Grenville replaced Bute. Grenville supported his predecessor's policy, even more so after the outbreak of Pontiac's Rebellion in May 1763. Grenville faced the problem of not only paying for these troops but servicing the national debt. The debt grew from £75,000,000 before the war to £122,600,000 in January 1763, and almost £130,000,000 by the beginning of 1764.〔Gary Nash pg. 45. Middlekauff pg. 55-63.〕
George Grenville did not expect the colonies to contribute to the interest or the retirement of the debt, but he did expect the Americans to pay a portion of the expenses for colonial defense. Estimating the expenses of maintaining an army in the Continental colonies and the West Indies to be approximately £200,000 annually, Grenville devised a revenue-raising program that would raise an estimated £78,000 per year.〔Middlekauff pg. 62.〕
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