Why Is The Sugar Act Necessary
The Sugar Act
Sugar and molasses were important commodities for Britain since they were its source of revenue from the colonies. The British West Indies were originally the colonists’ main molasses provider; however the colonists bought molasses from foreign markets where the commodity was cheaper. Because the colonists depended on other countries, the British government passed the Molasses Act in 1733, which implemented a tax of six pence per gallon on molasses bought from non-British colonies. The British hoped that the high tax would persuade the colonists to buy molasses from the British West Indies. In addition, the Molasses Act was supposed to help the West Indies gain profits and raise revenue to pay off the debt from the French and Indian War in 1763. Nonetheless, it was never seriously enforced because the colonists found ways to avoid paying the tax such as smuggling molasses and bribing custom officials. …show more content…
The businesses of British manufacturers also declined because the taxes minimized the colonists’ purchasing power. The Sugar Act ruined the economy of Britain and the colonies. It significantly reduced foreign trade and distorted the stability of colonial currencies. Since money was not being exchanged, the currency value deflated. The decrease in value meant colonies had to spend more money to buy goods. This influenced the loss of island trade partners such as Haiti and the Canary Islands, causing a global economic recession (“The Sugar Act”). Not only did the instability of the colonial currencies affect foreign countries, it also had a negative impact on British sellers because the colonists had to pay more for their goods. In addition, buyers from outside Britain had no motivation to purchase their goods since the colonists were not trading with them. The Sugar Act ultimately hindered the financial recovery of
Sugar and molasses were important commodities for Britain since they were its source of revenue from the colonies. The British West Indies were originally the colonists’ main molasses provider; however the colonists bought molasses from foreign markets where the commodity was cheaper. Because the colonists depended on other countries, the British government passed the Molasses Act in 1733, which implemented a tax of six pence per gallon on molasses bought from non-British colonies. The British hoped that the high tax would persuade the colonists to buy molasses from the British West Indies. In addition, the Molasses Act was supposed to help the West Indies gain profits and raise revenue to pay off the debt from the French and Indian War in 1763. Nonetheless, it was never seriously enforced because the colonists found ways to avoid paying the tax such as smuggling molasses and bribing custom officials. …show more content…
The businesses of British manufacturers also declined because the taxes minimized the colonists’ purchasing power. The Sugar Act ruined the economy of Britain and the colonies. It significantly reduced foreign trade and distorted the stability of colonial currencies. Since money was not being exchanged, the currency value deflated. The decrease in value meant colonies had to spend more money to buy goods. This influenced the loss of island trade partners such as Haiti and the Canary Islands, causing a global economic recession (“The Sugar Act”). Not only did the instability of the colonial currencies affect foreign countries, it also had a negative impact on British sellers because the colonists had to pay more for their goods. In addition, buyers from outside Britain had no motivation to purchase their goods since the colonists were not trading with them. The Sugar Act ultimately hindered the financial recovery of