Sugar Act Explained — Section 16

April 5, 1764

Section 16 of the Sugar Act of 1764 explains the penalties and fines for merchants who attempt to commit fraud regarding refunds on shipments of goods to the American Colonies.

Sugar Act, 1764, Date, Taxes, Reaction, Grenville Acts, AHC

George Grenville, Prime Minister and Chancellor of the Exchequer, was responsible for the Sugar Act of 1764, starting the movement in the 13 Colonies against Taxation Without Representation.

Understanding the Sugar Act of 1764

This entry is part of a series that explains the Sugar Act of 1764, including, rules, regulations, and penalties. To learn more, see History of the Sugar Act and Facts About the Sugar Act. Vocabulary, key people, and primary documents related to the Sugar Act are listed at the bottom of this article.

Section 16 — Penalties for Fraud Regarding Refunds

XVI. And be it further enacted by the authority aforesaid, That if any merchant or other person, shall from and after the said fifth day of May, one thousand seven hundred and sixty four, enter any goods for exportation to parts beyond the seas, in order to obtain any drawback not allowed by this act upon the exportation of such goods to the said British colonies or plantations in America, and the said goods shall nevertheless be carried to any British colony or plantation in America, and landed there contrary to the true intent and meaning hereof, that then, and in such case, the drawback shall be forfeited, and the exporter of such goods, and the master of the ship or vessel on board which the same were loaden and exported, shall forfeit double the amount of the drawback paid or to be paid for the same, and also treble the value of the said goods.


Section 16 of the Sugar Act of 1764 establishes penalties for merchants or other individuals who attempt to fraudulently obtain refunds on duties for goods exported to the American Colonies. The key points are:

  1. Effective Date — From May 5, 1764, onwards.
  2. Illegal Drawbacks — If any merchant or person tries to obtain a drawback on goods not allowed by this act by falsely entering them for exportation to locations outside of the British colonies.
  3. Fraudulent Export — If these goods are then carried to and landed in any British colony in America against the rules of this act.
  4. Penalties
    1. The drawback will be forfeited (the refund will not be given).
    2. The exporter (merchant) and the master (captain) of the ship carrying the goods will each be penalized:
      1. They will be fined double the amount of the drawback that was paid or intended to be paid.
      2. They will be fined three times the value of the goods involved.


Under the Sugar Act, merchants and other individuals who were accused of fraud were subjected to strict measures of detection and prosecution. This included heavy fines, such as those outlined in Section 16.


These terms and definitions provide more context for students studying the Sugar Act. For more on the Sugar Act as it relates to the AP US History curriculum, see Sugar ACT APUSH Review.

  • Authority — The power or right to give orders, make decisions, and enforce obedience.
  • Drawback — A refund of duties paid on imported goods when they are subsequently exported.
  • Enter — To officially record goods for exportation.
  • Exporter — A person or company that sends goods to another country for sale.
  • Forfeit — To lose or be deprived of something as a penalty for wrongdoing.
  • Goods — Items or products for sale or trade.
  • Intent — Purpose or intention.
  • Loaden — An old form of “laden,” meaning loaded with cargo.
  • Master — The captain or person in charge of a ship.
  • Merchant — A person or company involved in wholesale trade.
  • Penalties — Punishments or sanctions for breaking a law or rule.
  • Plantation — A large farm or estate, particularly in the American colonies, where crops are grown.
  • Treble — Triple or three times the amount.
  • True Intent and Meaning — The real purpose or intention behind a law or rule.

Key People

  • Samuel Adams — Adams helped lead opposition to the Sugar Act in Massachusetts. Went on to become a leader of the Boston Sons of Liberty and one of the most influential men behind the movement for independence.
  • George Grenville — Prime Minister and Chancellor of the Exchequer. Responsible for the design of the Sugar Act and introducing it to Parliament.
  • Stephen Hopkins — Governor of Rhode Island. Critic of the Sugar Act and its impact on the Rhode Island economy and colonial rights.
  • James Otis — Early advocate of the rights of Americans as British subjects. Argued against Writs of Assistance (1761) in the Paxton Case.

Primary Documents

Citation Information

The following information is provided for citations, including APA Style, Chicago Style, and MLA Style.

  • Article Title Sugar Act Explained — Section 16
  • Date April 5, 1764
  • Author
  • Keywords Sugar Act, What did Section 16 of the Sugar Act do
  • Website Name American History Central
  • Access Date June 21, 2024
  • Publisher R.Squared Communications, LLC
  • Original Published Date
  • Date of Last Update June 8, 2024