The Sugar Act of 1764

April 5, 1764 — History of No Taxation Without Representation

The Sugar Act, or the American Revenue Act, was passed by Parliament on April 5, 1764. The goal of the act was to raise revenue for Britain to pay part of the cost of a standing army in North America. It is most famous for starting the controversy over "No Taxation Without Representation" — a direct cause of the American Revolution and the War for Independence.

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

George Grenville, Prime Minister of Britain (pictured above), proposed the Sugar Act to raise money from the colonies to help pay Britain’s debt and to fund a standing army in Colonial America. Image Source: Wikimedia.

Sugar Act Summary

The Sugar Act of 1764 was an act of Parliament that updated and expanded the Molasses Act of 1733. The updates to the Molasses Act were approved by Parliament and King George III on April 5, 1764.

The new version, known as the Sugar Act, actually lowered taxes on molasses, but added taxes to other goods, required enforcement of the Navigation Acts by British customs officials, allowed the Royal Navy to enforce the law, and allowed trials of people accused of violating the Sugar Act to be held in the Vice-Admiralty Courts. Although all of those things concerned leaders in the colonies, the most controversial piece of the Sugar Act was the main reason it was passed by Britain — to raise money from the colonies.

Before the Sugar Act was passed, British laws governing the colonies usually dealt with regulating trade and restricting manufacturing in the colonies. The Sugar Act of 1764 made significant changes to British oversight of the colonies, which many Americans believed violated their rights as subjects of the King under the English Bill of Rights.

Americans opposed the Sugar Act by refusing to import products from British merchants and by writing articles and pamphlets that explained how Parliament was violating their rights.

The effect of the passage of the Sugar Act was the Sugar Crisis. It created a hostile environment in the colonies and distrust in the actions of Parliament was widespread, especially in New England where the provisions of the Sugar Act contributed to an economic depression.

Although the Sugar Act was eventually repealed, Parliament continued to pass laws that levied taxes on the colonies to raise revenue, which was a direct cause of the American Revolution and the War for Independence.

Samuel Adams, Painting, Copley
Samuel Adams began his rise to prominence as an outspoken critic of the Sugar Act. Adams went on to play a significant role in organizing opposition to British policy and signed the Declaration of Independence. Adams is one of the most important Founding Fathers in American History. Image Source: MFA Boston.

Sugar Act History

The Mercantile System in Colonial America

The history of the Sugar Act begins with the Mercantile System, which is based on the economic theory of Mercantilism that focuses on the trading of goods as a means to create wealth. For a nation to create more wealth, it needs to export more goods than it imports — it needs to sell more than it buys.

If it can achieve that, it creates a positive trade balance for the nation. In the Mercantile System, for a nation to maintain a positive trade balance, it must implement government regulations — restrictions — that protect its interests. This is called protectionism because the nation needs to protect — or control — all aspects of its economy. As far as Britain was concerned the colonies existed for two reasons:

  1. To provide the Mother Country — Britain — with raw materials manufacturers needed to make finished products.
  2. As a market for British manufacturers to sell finished products.

The Acts of Trade and Navigation in Colonial America

From 1651 through 1765, England — later known as Great Britain — imposed regulations on the production of raw materials and goods, methods of shipping, and shipping routes. The laws were set up so that Britain benefited, at the expense of its colonies, and allowed Britain to maintain a favorable trade balance against them, just like it sought to do against other European powers. These regulations are commonly known as the Acts of Trade and Navigation, or simply the Navigation Acts.

As far as the American Colonies were concerned, the Navigation Acts were designed to force merchants to comply with shipping laws, and the Trade Acts were designed to limit manufacturing, so colonists were forced to buy products from British merchants.

The Molasses Act of 1733

The Molasses Act was passed at the request of the owners of large sugar cane plantations in the British West Indies because they wanted to drive up the price of molasses that was being produced by competing plantations in the West Indies.

The Molasses Act and Salutary Neglect

Molasses from the plantations in the British West Indies was expensive and the American colonial merchants were able to trade with French, Dutch, and Spanish plantations in the West Indies and acquire molasses at a lower cost. The British plantation owners used their influence to look out for their interests and lobbied for a tax on the importation of foreign molasses into the colonies.

The tax — or duty — imposed by the Molasses Act was six pence per gallon, and it was supposed to be collected by customs officials when a ship arrived in port. However, merchants found several ways around paying the tax. They would bribe customs officials and pay them to look the other way or offload their cargo to smaller ships that could land in smaller ports where customs officials were not working. Customs officials did not go out of their way to collect the tax either. The lax attitude was part of a policy known as Salutary Neglect.

At the time, molasses was a staple food in New England. Molasses is made by harvesting sugar cane and processing it through several steps to where it can be boiled. The boiling results in a dark, thick syrup that has a high sugar content and a sweet, smoky flavor. Molasses was also used in the colonies as a sweetener for candy and other baked goods. It was also used to distill rum, which made up a significant portion of the economy in the New England Colonies — Massachusetts, Rhode Island, Connecticut, and New Hampshire.

When it passed the Molasses Act, Parliament hoped to force colonial merchants to trade for molasses from British sugar cane plantations in the West Indies. When that failed to happen, Parliament put provisions in the Sugar Act that levied stiff penalties and repercussions on merchants and customs officials who failed to comply.

The Sugar Act extended the Molasses Act of 1733, which was set to expire in 1763, by continuing the tax on imported molasses.

Sugar Act Purpose

The purpose of the Sugar Act was to raise revenue from the American Colonies to help offset the deficit incurred by the French and Indian War and to raise revenue for the crown.

Pontiac’s Rebellion and the Proclamation of 1763

The French and Indian War had nearly doubled the national debt of Britain. It also expanded British territory in North America because France ceded nearly all of its territory, including the Ohio Country, to Britain.

Something also had to be done about skirmishes that were breaking out between the Indian tribes that lived west of the Appalachian Mountains and American colonists on the frontier. Most of the tribes had fought on the side of the French during the war and did not trust the British. Some tribes banded together and launched a series of attacks on British forts and colonial settlements in an uprising known as Pontiac’s Rebellion.

To appease the tribes, the Proclamation of 1763 was issued on October 7, 1763. It set the western boundary of the colonies at the Appalachian Mountains and reserved the new territory west of the mountains as “hunting grounds” for the tribes.

Further, to protect the colonies and the expanding frontier, Prime Minister John Stuart, Earl of Bute, decided to keep a standing army of 10,000 British soldiers in the colonies. Because the Ohio Country was unsettled, and not officially part of any colony, protecting it was considered part of national defense.

Fort George, New York
This illustration depicts Fort George in New York City. British troops were stationed at Fort George and other places in the city after the French and Indian War. Image Source: New York Public Library Digital Collections.

George Grenville succeeded Bute as Prime Minister of Britain in April 1763. He decided the best way to reduce the debt would be to levy taxes on the American colonies. After all, the deficit had been created because Great Britain had to defend the colonies from the French and it was only going to get worse now that there was new territory that needed to be defended and protected.

Although Grenville was the architect of the Sugar Act, he only expected the colonies to pay a portion of the expenses needed for their defense. It was never his intent the colonies should cover all of the expenses. Britain was going to cover most of the cost of troops that were stationed at wilderness forts to protect the Ohio Country.

With the passage of the Sugar Act, Parliament was, for the first time, levying taxes directly on the colonists to raise revenue.

Sugar Act Enforcement — Taxation, Regulation, and Penalties

The Sugar Act was also known as The American Revenue Act or the Plantation Act. It was passed by Parliament on April 5, 1764, to:

  • Extend the Molasses Act of 1733, which was initially passed for the benefit of the owners of sugar cane plantations in the British West Indies.
  • Secure the trade between Great Britain, its colonies in America, and its plantations in the West Indies by cracking down on smuggling.
  • Raise money to help pay down debt incurred from fighting the French and Indian War.
  • Raise money to “improve the revenue of the kingdom” and to pay for the defense, protection, and security of the colonies, plantations, and new territory in North America acquired by Great Britain due to its victory in the French and Indian War.

Britain lost money with the Molasses Act because it cost it more money to enforce the provisions of the act than customs officials collected in taxes. This was due primarily to smuggling and Salutary Neglect.

However, Britain could not lose money moving forward. It needed to generate a profit from the enforcement of the Sugar Act, and it was determined to do so. The provisions of the Sugar Act:

  • Reduced the tax on a gallon of imported molasses by fifty percent; from six pence per gallon to three pence per gallon.
  • Added taxes to other popular goods, like sugar and coffee, that were often imported from foreign manufacturers.
  • Placed restrictions on where goods like lumber, iron, and whalebone could be shipped.
  • Enforced regulations that required ships to document cargo and sail to Great Britain to have it verified by customs officials before it could be delivered to the colonies or plantations.
  • Levied heavy fines on merchants, ship captains, and customs officials who failed to follow the new laws.

To provide some context, 100 pence makes up one British pound, similar to pennies and dollars in the United States.

Parliament believed cutting the tax on molasses in half would increase the demand for molasses in New England. In turn, that would create additional profits for merchants. If that happened, Parliament thought colonial merchants would have no problem paying the tax of three pence per gallon. In fact, Parliament believed the merchants would give up smuggling. Unfortunately, Parliament failed to see just how its policies would affect the colonies. This was due in part to Parliament’s adherence to the Mercantile System and the lack of colonial representation in Parliament.

In the 18th century, Great Britain was still clinging to an economic philosophy called mercantilism (although it was not known by that name until 1776). Followers of the philosophy believed one of the reasons the colonies existed was to produce raw materials that could be shipped to Great Britain and manufactured into products. They also believed the government needed to control the economy and exploiting the colonies for both raw materials and revenue was well within Britain’s right as the mother country. They believed that as long as Great Britain prospered the colonies would too, although not to the same level.

Sugar Plantation, West Indies, Illustration
This engraving, published by John Hinton in 1749, depicts the process of harvesting sugar cane at a plantation in the West Indies. Image Source: Library of Congress.

After the French and Indian War, there was an economic depression in the American colonies and the Sugar Act only made it worse. Parliament underestimated the importance of rum on colonial trade — rum is made from molasses — and the economic impact that new taxes and regulations would have on the colonies. If the colonies had been allowed to have elected representatives in Parliament, then maybe Parliament would have had a better understanding of how the new policy was going to damage the colonial economy.

Although nine colonies protested by sending letters to Parliament, their arguments fell on mostly deaf ears. Most of the opposition they raised was concerning the economic impact. They were especially concerned with the restriction of trade with non-British ports and the enforcement of rules regarding the transportation of goods from one port to another. If the colonies had worked together to formulate a single, unified response, it might have helped their cause.

People started to question whether Parliament had the constitutional authority to levy taxes to “improve the revenue” of the kingdom, especially since the colonies were not represented in the government and the revenue went directly into the treasury. The constitutionality of the act was also questioned because of how it handled court cases.

Key figures like James Otis and Samuel Adams began to formulate the basis for their arguments against “no taxation without representation,” which became a key component of the ideas behind the American Revolution.

New Taxes Levied on Other Goods

The Sugar Act expanded the tax created by the Molasses Act to more imported products, including:

  1. Sugar
  2. Indigo
  3. Coffee
  4. Wine
  5. Silk
  6. Herbs

The sugar tax, for which the act is known, levied a tax of “one pound, two shillings” for every 100 pounds of “foreign white or clayed sugars.”

Regulation of Trade

The Sugar Act regulated trade by specifying where ships could dock and required ships to have their cargo checked and verified by customs officials every step of the way.

Most ships were required to sail to a port in England, have their cargo checked by customs officials, and then pay the taxes. Once that was done, the ship could continue on its voyage.

All of this extra sailing and time involved added up to extra expenses for the merchants. Merchants shipping iron or lumber were strictly prohibited from shipping wood or iron to other ports in Europe. Section XXXVIII (38) specifically said that “no iron, nor any sort of wood, commonly called Lumber” could be “landed in any part of Europe except Great Britain.”

Captains were required to have papers with them that proved what they were carrying was legal and how much of each product they had on board. Even the smallest mistake in the paperwork could result in the entire cargo of a ship being seized by customs officials.

Ships were also under regulations for how long they could take to get from one port to another, although Sections XIII (8) and XXIII (23) do take into account the “danger of seas and enemies.”

Enforcement of the Act and Penalties

The Sugar Act was enforced by British customs officials, the Royal Navy, and the admiralty courts.

The Sugar Act included provisions that allowed for strong customs enforcement. Customs officials were given the authority to stop any British ship or vessel that was within two leagues of the shore if they suspected it was transporting illegal goods, or sailing without the proper papers. If the captain of the vessel could not produce the proper paperwork then officials were authorized to seize the cargo.

Merchants were subject to heavy fines if they were caught smuggling. If they were convicted, then their cargo was sold at an auction to help cover the costs of the court and to reward British officials for enforcing the law.

The customs officials had a financial incentive to accuse a merchant of smuggling because they were due one-third of all goods and ships confiscated under the Sugar Act. Naval officers also had an incentive and were entitled to a share as well.

Section XLI (41) placed jurisdiction of cases related to violations of the Sugar Act under the authority of the admiralty courts. At that time, customs officials were under the authority of the Vice-Admiralty Court in Halifax, Nova Scotia. Unlike traditional courts, the Vice-Admiralty Court did not use a jury. The decision of the court rested entirely with the judge.

Cases that dealt with smuggling could be transferred by customs officials to the court at Halifax. This created problems for colonial merchants and increased the likelihood they would lose their case for many reasons, including:

  • The defendant had to travel to Nova Scotia. If the defendant failed to appear they were automatically found guilty.
  • The burden of proof was on the defendant and they were assumed guilty until they could prove their innocence.
  • The customs officials could not be counter-sued.
  • The customs officials had a financial incentive to accuse a merchant of smuggling because they were due one-third of all goods and ships confiscated under the Sugar Act.
  • The judges had an incentive to find the defendant guilty because the judge would receive five percent of all confiscated cargo and ships.

Although the English Bill of Rights guaranteed a fair trial by a jury of peers, any case that was sent to Halifax violated that right because the cases were not decided by a jury of peers. Cases that were heard in front of the court in Halifax had a high rate of conviction.

Before the passage of the Sugar Act, customs officers in the American colonies had been easy to bribe, which made the collection of the Molasses Act tax difficult. Section XXXVIII (38) of the Sugar Act created heavy fines that would be levied on customs officers who were found guilty of taking bribes or falsifying records, and those officers would also be barred from serving in any position in the government and military.

Section XLV (45) allowed customs officers to accuse any ship or merchant of smuggling and put the burden on the accused to prove they were not smuggling. It says, “proof thereof shall lie upon the owner or claimer of such ship or goods, and not upon the officer who shall seize or stop the same; any law, custom, or usage, any law, custom, or usage, to the contrary notwithstanding.”

Section XLVI (46) took things further and made it so customs officials could not be sued, even if the defendant was found innocent. It says, “nor shall the person who seized the said ship or goods, be liable to any action, or other suit or prosecution, on account of such seizure.”

The Sugar Act also expanded the potential for customs officials to use writs of assistance to seize and search ships without a warrant, and to force local law enforcement officials to assist in the process.

Sugar Act Effects

A Turning Point in British Policy

The Sugar Act marked a turning point in British policy because it was the first time a tax was levied simply to raise money for the treasury. It was also a step towards British imperialism because Great Britain started to treat colonial America as a competing nation. Up to the point the Sugar Act was passed, acts passed by Parliament that dealt with the colonies were primarily intended to regulate trade or to restrict manufacturing in Colonial America. However, the language in the Sugar Act made it clear the purpose of the act was to both regulate trade and increase revenue.

Effects of the Sugar Act on American Merchants

After the French and Indian War, the American colonies were hit by an economic depression, and the Sugar Act made it worse.

During the war, there had been a steady need for food, supplies, and clothing for the troops that were fighting the French. Without the war, orders fell off, and it had a serious impact throughout the colonies. Farmers felt the impact the most because their crops were no longer needed by commissaries that needed to feed hundreds or thousands of men. If Parliament had allowed the colonies to have representation, it may have had a better understanding of the situation and tried a different solution than levying taxes and restricting trade.

The Molasses Act was set to expire in 1763, around the same time as the French and Indian War ended. The British Commissioners of Customs thought that there would be a higher demand for molasses and the products produced from it, especially rum. Higher demand would mean higher profits for the merchants, so the commissioners thought that if they lowered the tax on molasses the merchants would be more likely to pay it.

For the tax to be collected and for the benefits of the Sugar Act to be realized, it required customs officials and naval officers to be granted the authority to enforce it. The British Navy used the Sugar Act as a license to harass small ships, which would be stopped frequently and searched. If illegal cargo was found, the British would take the cargo and sell it themselves. This, of course, was not Parliament’s intent in enforcing the Sugar Act. It was an unforeseen circumstance, but it certainly hurt the relationship between the colonists and British seamen. Not surprisingly, colonists responded by occasionally harassing sailors when they were ashore.

Enforcement of the Sugar Act threatened the ability of business owners to conduct business as they saw fit and only made the economic depression worse. In fact, it forced many colonial merchants to change how they were doing business, because it limited the markets that they had access to, increased their expenses, and reduced their profits, all during difficult economic times.

Rum was a key component of trade for the colonies, and enforcement of the act caused an immediate decline in the rum business. Distilleries in Massachusetts, Rhode Island, New York, and Pennsylvania desperately needed molasses to make rum, and their production had an impact on other industries that commonly used rum to trade for goods they needed.

The Massachusetts Bay colony wrote a letter to Parliament called “Reasons Against the Renewal of the Sugar Act” and protested the new measures. It warned Parliament the Sugar Act would cripple the rum industry in New England and not only harm the economy of the colonies but also of Great Britain. Massachusetts wrote:

“It is apprehended that the trade is so far from being able to bear the high duty imposed by this act, on sugar and molasses, that it will not bear any duty at all. As the price of molasses now is, it will barely answer to distill it into rum for exportation: Should this duty be added, it would have the effect of an absolute prohibition on the importation of molasses and sugar from the foreign islands, and consequently the same effect on the exportation of fish, lumber and other commodities from hence to those islands, as the french, dutch and other foreigners, whom we supply with those articles, will not per|mit us to bring away their money; so that unless we can take their ordinary sugars and molasses in return, this trade will be lost. And if an end should be put to our trade to the fo|reign islands, Great-Britain would finally lose much more than would be gained by the duty on sugar. For should the colonies be obliged to take from our own islands all the west india produce that they consume, the price in Great Britain must necessarily advance more than double this duty. But if we are permitted to import foreign sugars and molasses into the northern colonies, more of our west india produce will be carried to Great Britain, where the consumption is supposed to be equal to the whole produce of our islands.”

Benefits of the Sugar Act

British customs officials, judges, and the British treasury benefited from the Sugar Act.

It is important to understand who Parliament thought was going to benefit from the Sugar Act and who actually did.

Because it followed the philosophy of mercantilism, Parliament thought the Sugar Act was going to benefit the treasury, the American colonies, and plantations in the British West Indies. The reality is, the Sugar Act produced limited benefits, due to the economic depression that affected the colonies after the French and Indian War.

Parliament believed the merchants who bought and sold molasses would benefit because the tax on molasses was cut in half, from six pence per gallon to the pence per gallon. The reality is the tax was still too high and nearly destroyed the rum distilling business in New England.

Customs officers, naval officers, and other government officials benefited because they were given incentives to enforce the Sugar Act. Section XLII (42) spelled out the monetary rewards they would receive after the illegal goods were sold at auction.

  • One-third went to the collector of the customs.
  • One-third went to the governor or commander-in-chief of the colony or plantation.
  • One-third went to the person who caught the merchant in the act of smuggling.

Seizures made at sea by the navy had slightly different rewards:

  • One-third went to the collector of the customs.
  • The rest went to the commanders and officers of the naval vessels that caught the ship smuggling goods.

Harm Caused by the Sugar Act

The Sugar Act harmed colonial merchants and made the economic depression that hit the colonies after the French and Indian War worse. It also violated the constitutional rights of British citizens in the way court cases regarding violations of the Sugar Act were handled.

Parliament failed to understand that molasses was a key part of the trade between the colonies, England, the West Indies, and West Africa. It quickly caused a decline in the rum business and harmed colonial merchants who were doing business on a global scale with merchants from other countries, such as France and the Netherlands.

It restricted who they could buy goods from, which drove up prices. In most cases, the price increase had to be passed on to the customer. If the customer could not afford the higher prices, then the chance of the merchant going out of business increased.

The Sugar Act reduced the money merchants had available, which meant they had less money available to buy goods manufactured in Great Britain. This, in turn, hurt the manufacturers in Great Britain who relied on raw materials from the colonies to make their products.

It also forced merchants to sail to Britain to have their cargo checked before they sailed to colonies to deliver the goods. It usually took a ship at least six weeks to make the trip from England to the colonies, and sometimes as long as two to three months, depending on the weather. Merchants had to incur additional expenses such as pay and provisions for the crew. It also increased the chances of losing cargo to piracy or storms on the high seas.

In the minds of many colonists, the consequences of breaking the law infringed on the rights of anyone who was brought up on charges of violating it, because it eliminated fair trial by a jury of peers. According to the act, anyone who was charged could be sent to Halifax, Nova Scotia to stand trial before the new Vice-Admiralty court.

The Massachusetts legislature responded to this on November 3, 1764, in the “Petition from the Massachusetts House of Representatives to the House of Commons” that said, “The extension of the powers of the courts of vice-admiralty has, so far as the jurisdiction of the said courts hath been extended, deprived the colonies of one of the most valuable of English liberties, trials by juries.”

Sugar Act and the American Revolution — Colonial Reaction to the Sugar Act

The American colonies reacted with widespread opposition to the Sugar Act, but they did not come together to create a unified response.

Nine colonies officially sent messages to Parliament speaking out against the Sugar Act, but only two of them, New York and Virginia, specifically stated that Parliament had no right to tax the colonies to raise money.

In April 1763, Boston merchants found out that Parliament was considering renewing and extending the Molasses Act. They formed a group called the Society for Encouraging Trade and Commerce and set up a committee to write up how the continuation of the molasses tax would have a negative impact not only on the colonies but also on Britain and the West Indies. The Boston merchants recruited allies in other parts of the colony and collectively they issued the Reasons Against the Renewal of the Sugar Act. In that document, they spelled out in significant detail how the Sugar Act would have a negative impact not just on the American colonies, but all of Great Britain.

The colonies also felt that they had paid their fair share by providing so many troops to help fight in the French and Indian War. James Otis expressed this sentiment in “The Rights of the British Colonies, Asserted and Proved,” when he said the loyalty of the colonies to Britain  “…has been abundantly proved, especially in the late war. Their affection and reverence for their mother country is unquestionable. They yield the most cheerful and ready obedience to her laws, particularly to the power of that august body the Parliament of Great Britain, the supreme legislative of the kingdom and in dominions.”

James Otis, Portrait, Illustration, NYPL
James Otis. Image Source: New York Public Library Digital Collections.

In the colonies, the political process worked from the ground up. The towns would hold meetings and send instructions to their representatives in the colonial legislature. Then the colonial legislature would create instructions based on the feedback and send them to the colony’s representatives in London. Vocal opposition to the Sugar Act in places like Boston was led by men like Otis and Samuel Adams, who played key roles in the American Revolution.

In Massachusetts, the legislature formed a committee and tasked it with formulating a response to the passage of the Sugar Act. A letter that outlined the concerns about the Sugar Act and arguments against it was written and sent to Parliament but was based on instructions it received from the towns.

On May 15, 1764, Samuel Adams was appointed to a committee of the Boston Town Meeting. The purpose of the committee was to provide instructions to Boston’s representatives in the colonial legislature on how the city wanted them to respond to the Sugar Act. The letter, “Instructions to Boston’s Representatives” was dated May 28, 1764.

In the letter, Adams informed the legislature that it needed to tread carefully because the prosperity of the colony was at stake. He wrote, “As you represent a town which lives by its trade we expect in a very particular manner that you will make it the object of your attention to support our commerce in all its just rights, to vindicate it from all unreasonable impositions & promote its prosperity – our trade has for a long time labord under great discouragement;& it is with the deepest concern that we see such further difficultys coming upon it which will reduce it to its lowest ebb, if not totally obstruct and ruin it.”

Adams also viewed the passage of the Stamp Act in terms of Parliament moving in a direction that could be dangerous and lead to more taxation. He wrote, “What still heightens our apprehension is, that these unexpected proceedings may be preparatory to new taxations upon us: For if our trade may be taxed why not our lands? Why not the produce of our lands & every thing we possess or make use of?”

Sugar Act and the American Revolution — The English Bill of Rights and No Taxation Without Representation

The colonists met the passage of the Sugar Act with resistance because they believed raising revenue through taxes was unconstitutional and a violation of their rights as Englishmen under the English Bill of Rights. Colonists started to openly protest against Parliament’s infringement on their business affairs.

It was not an entirely new concept in the colonies. Cotton Mather had raised the issue during the Great Boston Revolt of 1689 when he referenced the “raising of taxes without an assembly.”

Many colonists believed it was unconstitutional because it had been designed, voted on, and enforced on them by people who did not represent them. James Otis called it “taxation without representation.”

Samuel Adams also questioned the constitutionality of the Sugar Act, “If taxes are laid upon us in any shape without our having a legal representation where they are laid, are we not reduced from the character of free subjects to the miserable state of tributary slaves?”

Stephen Hopkins, the Governor of Rhode Island, questioned the constitutionality of the act in “The Rights of the Colonies Examined.” He wrote, “. . . Have not the colonies here, at all times when called upon by the crown, raised money for the public service, done it as cheerfully as the Parliament have done on like occasions? Is not this the most easy, the most natural, and most constitutional way of raising money in the colonies? What occasion then to distrust the colonies—what necessity to fall on an invidious and unconstitutional method to compel them to do what they have ever done freely? Are not the people in the colonies as loyal and dutiful subjects as any age or nation ever produced;  and are they not as useful to the kingdom, in this remote quarter of the world, as their fellow-subjects are who dwell in Britain?”

Stephen Hopkins, Illustration
Stephen Hopkins. Image Source: New York Public Library Digital Collections.

It also robbed anyone accused of violating the Sugar Act of their right to a fair trial by a jury of their peers.

The Sugar Act and Its Effect on British Colonial Policies

Salutary Neglect

The Molasses Act of 1733 placed a tax of six pence per gallon on molasses. However, the law was not strictly enforced and taxes were not collected due to Salutary Neglect. The passage of the Sugar Act, with its strict enforcement of the law, effectively ended Salutary Neglect.

Salutary Neglect was an unofficial policy in which British officials did not strictly enforce trade laws, such as the collection of taxes. The concept was initiated by Prime Minister Robert Walpole to ease restrictions on the American colonies, which would allow England to focus on matters in Europe. The policy was given a name on March 22, 1775, when Edmund Burke spoke to Parliament and referred to the “wise and salutary neglect” of British officials as one of the factors that had led to the commercial success of the colonies.

Unfortunately, there were unintended consequences of the policy. Parliament would eventually discover that allowing the colonies to conduct business under Salutary Neglect and without economic and political restrictions created a sense of freedom and prosperity that would turn out to be impossible to turn back.

The Sugar Act helped end Salutary Neglect by implementing strong measures that allowed for the enforcement of collecting taxes and regulating trade for colonial merchants.

For Great Britain, it was a step towards imperialism. For the American colonies, the unrest and protest against the Sugar Act was a small step towards independence.

Edmund Burke, Portrait
Edmund Burke. Image Source: Wikipedia.


The Sugar Act reinforced the economic philosophy of mercantilism by placing strict government control on the economy and regulating commerce in the colonies.

Mercantilism was a popular economic philosophy that was practiced in Europe during the 16th, 17th, and 18th centuries as nations transitioned from feudal systems of government to national governments. The system was given its name in 1776 by Scottish economist Adam Smith in his thesis “The Wealth of Nations.”

It was essentially a system where the government controlled the economy of the nation to accumulate wealth in the form of gold and silver. However, proponents of mercantilism believed there was a fixed amount of wealth available in the world and that the more gold and silver a nation owned the more powerful it was.

One of the ways a nation could increase its gold and silver was to achieve a favorable trade balance by:

  • Maximizing exports. Exports are goods that are shipped out of a country, to be sold in another. Exported goods make money.
  • Minimizing imports. Imports are goods that are brought into a country, and they cost money.

To maintain a favorable trade balance, nations needed a large working population and colonies that provided raw materials. If a nation had both of those, then it could put people to work making products that could be sold — or exported — to other nations. If it manufactured enough products, then it would not need to buy — or import — from other nations.

To reduce the need for imports a nation needed to be as self-sufficient as possible and not only produce enough products to export, but also enough for its population. In Great Britain’s model of mercantilism, the American colonies and plantations in the West Indies provided the people and raw materials necessary for the nation to maintain and grow its cache of gold and silver.

However, the British mercantile system also depended on keeping the American colonies from amassing gold and silver. As a result, manufacturing was discouraged in the colonies, and they could only manufacture products that could not be made in Great Britain. It also led to an increase in the use of paper money in the colonies.

As far as the proponents of mercantilism were concerned, one of the main reasons the colonies existed was to produce raw materials that could be sent to Great Britain to be manufactured into products. Not only were the colonies the producers of the raw materials for the manufacturers in Great Britain, but they were also the major market for the manufacturers to sell products.

Parliament shifted its thinking on the American colonies when it passed the Sugar Act. It no longer looked at the colonies and the people as a source of raw materials and a market, but also as a source of revenue. It was essentially treating its colonies — its own people — the same way it would another nation that it was competing with for gold and silver.

Before the Sugar Act, there were regulations in place regarding trade, but they were largely ignored due to Salutary Neglect, bribery, and rampant smuggling. Colonial merchants enjoyed a fairly free market where they could trade with anyone they wanted to, even if their trading partner was a merchant from a nation that was an enemy of, or at war with, Great Britain.

The Sugar Act helped reinforce the mercantile system by:

  • Adding taxes to more products than just molasses.
  • Restricting who colonial merchants could trade with.
  • Implementing regulations that imposed heavy fines for violations of the act.

Triangular Trade

Sugar was one of the goods that were part of the Triangular Trade between the American colonies, Great Britain, West Africa, and the West Indies. The Sugar Act restricted colonial merchants from doing business with foreign merchants by levying heavy taxes on imported goods.

Sugar Cane Plantation, Enslaved Workers, Sugar Act Image
This illustration depicts, enslaved workers harvesting sugar cane on a plantation.. Image Source: New York Public Library Digital Collections.

Triangular Trade is a term that refers to the routes on the Atlantic Ocean that colonial vessels traveled along to conduct commerce and trade with Great Britain, Europe, the West Indies, and Africa. The main routes were:

  • England to Africa to the colonies
  • England to Africa to the West Indies
  • Europe to the West Indies to the colonies
  • Colonies to the West Indies to Europe

Triangular Trade was a key byproduct of mercantilism, because Great Britain tried to follow the routes that were the most profitable, and kept the balance of trade in its favor.

Rum was a key component in the triangular trade between the New England colonies, the West Indies, and Africa. The New England colonies would ship rum to West Africa where it was traded for slaves.

Captive Africans would be transported across the Middle Passage of the Atlantic Ocean to the West Indies, where they would go to work on the sugar plantations. The plantations would make molasses from sugar cane and ship it to the New England colonies.

Slaves were not always involved in the transactions with the New England colonies. Sometimes the transactions included fish, wine, or other products.

Regardless, the Triangular Trade involving the New England colonies led to a rise in rum distilleries in the New England colonies, especially in Rhode Island and Connecticut.


Parliament used the Sugar Act to promote colonialism because it used the idea of raising revenue to exploit the colonies.

Colonialism is a policy where a nation settles an area, occupies it with settlers, and then exploits it for economic purposes. Not all of the American colonies were started for the same reasons or founded for economic purposes, but by the middle of the 18th century, nearly all of them were operating in the same fashion.

Parliament exploited the colonies with the passage of the Sugar Act when it explicitly levied taxes to generate revenue for the treasury.

Results of the Sugar Act

The Sugar Act was not successful and failed to generate the revenues that Parliament expected. Despite the lower tax on molasses, smuggling continued until the taxes were reduced in 1766 by the Revenue Act, which lowered the revenue collected from imports.

Timeline of the Sugar Act

The Sugar Act of 1764 was in effect for about two years. It was passed by Parliament on April 5, 1764, and replaced by the Revenue Act of 1766.

The Molasses Act set the tax on molasses at six pence per barrel. The Sugar Act cut it in half to three pence per barrel. However, the going rate to bribe a customs official was one and a half pence, so it was more economical for merchants to pay the bribe.

Smuggling continued until at least 1766 when the tax was lowered to one pence by the Revenue Act of 1766, and it became cheaper to pay the tax than to pay the bribe.

The Revenue Act, which was enforced until 1776, was enormously successful and raised around 300,000 pounds.

Significance of the Sugar Act

The Sugar Act was significant because it marked the first time Parliament levied a tax on the American colonies to generate revenue. It also did away with the unwritten policy of Salutary Neglect.

It made the Economic Depression in New England Worse

Parliament believed that if merchants were forced to stop in British ports they would be more likely to purchase British goods and take them back to the colonies to be sold. However, it showed how out of touch Parliament was with the reality of commerce and trade in the colonies. The Sugar Act promoted mercantilism, pushed toward imperialism, and made the economic depression in the colonies worse.

Parliament thought that reducing the tax on molasses would increase the likelihood that merchants would pay the tax instead of smuggling. However, merchants were able to pay a bribe of one and a half pence per gallon. That money went directly into the pocket of the customs official and none went to the British treasury. This went on until the tax was lowered to one pence per gallon in 1776. Adding taxes to new products, like wine, actually increased smuggling, because merchants found ways around paying the new taxes.

Since the colonies had no representation in Parliament, they took great offense to the tax, even though they failed to develop a unified response. Many colonial leaders thought the tax was unconstitutional and an infringement on their rights. Men like Samuel Adams and James Otis saw it as the beginning of a dangerous path for Parliament and seized the opportunity to speak out and write about the dangers of the Sugar Act, which put them in the public eye and increased their popularity and recognition.

The Sugar Act Was a Cause of the American Revolution

The opposition to the Sugar Act led to the American Revolution by helping start a process where many political and business leaders in the colonies started to give serious thought to how Britain treated the colonies. Before 1763, there had been some minor instances where colonists had spoken up about British policy, especially during the legal dispute in 1761 over Writs of Assistance.

James Otis and Samuel Adams Gained Popularity

Samuel Adams gained notoriety because of his letter, which set him on a path where he was the primary voice in Boston and Massachusetts speaking out against British policies. The arguments James Otis made against the Sugar Act eventually became “no taxation without representation” which was a popular rallying cry during the Stamp Act Crisis. Both men would go on to have a strong influence on other leaders of the American Revolution, especially John Adams.

On March 15, 1764, a letter was printed in the Massachusetts Gazette that had been written to a merchant in London. The author of the letter warned that if Britain did not repeal the Sugar Act it could be disastrous.

“…what more alarms us, is, the attack made upon our molasses trade to Surinam and the West-India islands, which is a principal support of our rum manufactory, fishery, and lumber trade. These stopped, we cannot possibly make our remittances to London, and in that case, I am satisfied, England must sensibly feel the loss of her colonies, as a market for her manufactories.”

Americans at Fort George Fired on the HMS St. John

The economy of Rhode Island was especially dependent on rum, and there were run-ins between colonists and the British Navy. One incident in Rhode Island led to shots being fired on a British ship.

To help enforce the act and catch smugglers, British naval ships were sent to patrol the waters off the coast of New England, including the HMS St. John. In July 1764, the St. John was on patrol in Narragansett Bay, keeping an eye out for smugglers. Some of the crewmen were in the town of Newport and had been accused of stealing some chickens. They also tried to force a man to join their crew, an act known as impressment. A fight ensued and the crewmen were driven off.

The local authorities wanted to arrest the crewmen, but their captain kept them on the ship and would not allow them to leave. This upset the townspeople, who then learned the crewmen were going to try to escape. Fort George was located on Goat Island, and guarded the passage out of the bay. Orders were sent from Newport to the fort, ordering the St. John to be stopped if it tried to get out of the harbor.

The St. John set sail. When the Rhode Islanders at the fort saw the ship approaching, they tried to hail it, but the St. John ignored them and continued to sail. One cannon at the fort opened fire on the ship, firing about 10 balls towards the St. John.

All of the shots were missed, but it marked the first time colonial guns fired on a British ship. It was also a significant moment for Rhode Island in the American Revolution.

Critical Issues Raised by the Sugar Act — No Taxation Without Representation

The Sugar Act also brought the concept of taxation without representation to the forefront, and the issues of taxes being raised either for the benefit of the crown instead of to regulate the flow of trade. This upset the colonists, especially James Otis. Not only did it set the stage for the colonial response to the Currency Act, which was passed on September 1, 1764, but also to the Stamp Act of 1765.

Frequently Asked Questions About the Sugar Act

This list of common questions about the Sugar Act provides more details about the purpose, causes, effects, and outcome of the act on Colonial America, the British Empire, and the American Revolution.

What was the meaning and definition Sugar Act?

The Sugar Act definition is a British law passed by Parliament in 1764 to make money from the American Colonies to help pay for the British Army in North America. Money was raised by taxing goods and enforcing the Navigation Acts. The controversial law was a cause of the American Revolution.

How did the Sugar Act extend the Molasses Act?

The Sugar Act extended the Molasses Act by continuing the tax on molasses that had been established in 1733. The Sugar Act also required enforcement of the Navigation Acts and Trade Acts and the collection of customs duties by British customs officials. It also extended the power of Vice-Admiralty Courts.

How did the Sugar Act regulate trade?

The Sugar Act regulated trade by enforcing shipping laws in Colonial America. Merchants were forced to comply with the Navigation Acts, which required shipments to be registered and checked at each port for customs duties to be paid. Captains were required to show a manifest at each port.

How was the Sugar Act enforced?

The Sugar Act was enforced by British customs officials, the Royal Navy, and the Vice-Admiralty Court. Customs officials and Naval Officers were given the authority to stop American vessels if they suspected it was carrying goods illegally — smuggling. The Vice-Admiralty Court in Halifax, Nova Scotia was responsible for hearing cases.

How did British Policy change with the Sugar Act?

The Sugar Act changed British policy in two very important ways. First, it ended the unwritten policy of Salutary Neglect, which had allowed American merchants to conduct business as they saw fit. Second, it was the first time taxes were levied on the colonies to raise revenue.

Why was the Sugar Act Passed?

The Sugar Act was passed to help pay some of the expenses of the British Army in North America. The British Treasury looked for ways to raise money and suggested enforcing the Molasses Act and extending it with new regulations, which were approved by Parliament with input from colonial agents.

How did the Sugar Act affect the American colonies?

The Sugar Act affected the colonies by making the post-war economic depression worse, especially for rum distillers in New England. Although the Sugar Act lowered the tax on molasses, it restricted the trade of molasses and forced merchants to buy more expensive molasses from plantations in the British West Indies.

Who did the Sugar Act benefit?

The Sugar Act benefitted the owners of sugar cane plantations in the British West Indies because it gave those plantation owners a virtual monopoly on the molasses trade with American merchants. Americans were subject to heavy fines if they traded with plantations in other places, like the French West Indies.

Who did the Sugar Act harm?

The Sugar Act harmed nearly everyone in the colonies because it made the post-war economic depression worse. It also harmed British merchants who relied on Americans to buy their finished products, either because the Americans could not afford to place orders, or refused to in protest of the Sugar Act.

How did the colonists react to the Sugar Act?

Colonists reacted to the Sugar Act by refusing to import products from British merchants and by writing articles and pamphlets that explained how they believed Parliament was violating their rights. The crisis over the Sugar Act created a hostile environment in the colonies and distrust in the actions of Parliament.

Why did colonists think the Sugar Act was unconstitutional?

Colonists thought the Sugar Act was unconstitutional because it violated their right to a trial by a jury of peers, by holding trials in the Vice-Admiralty Court. Colonists were also skeptical that Parliament had the authority to levy taxes on the colonies without their consent — known as “taxation without representation.”

How did Salutary Neglect affect the Sugar Act?

Salutary Neglect affected the Sugar Act in terms of the colonial reaction. When Britain started to enforce the Sugar Act, it upset American merchants and forced them to change how they were running their businesses. It also created controversy over taxation by Parliament without the approval of the colonial legislatures.

How did the Sugar Act implement mercantilism?

The Sugar Act implemented mercantilism by continuing the practice of Britain controlling the economy of the colonies for its benefit and to maintain a positive trade balance. It reinforced the economic philosophy of the Mercantile System which means the colonies only existed for the benefit of the Mother Country.

What role did the Sugar Act play in triangular trade?

The Sugar Act played a role in Triangular Trade because sugar was one of the key goods in the trade between the American Colonies, Great Britain, West Africa, and the British West Indies. The Sugar Act forced colonial merchants to adhere to Triangular Trade by restricting trade with foreign merchants.

How did the Sugar Act promote colonialism?

The Sugar Act promoted colonialism by increasing Britain’s ability to exploit and control the economy in the American Colonies. Merchants had to comply with the Navigation Acts, and the money raised helped pay for the new standing army that was stationed in New York and forts on the western frontier.

Was the Sugar Act successful?

The Sugar Act was not successful in many ways. It did not raise the amount of money the British Treasury expected. Further, the new law made the post-war economic depression in the colonies worse, disrupted trade between the colonies and Britain, and created a hostile attitude and distrust toward Parliament.

How long was the Sugar Act in effect?

The Sugar Act was in effect for roughly two years. It started on September 29, 1764, and was repealed by the Revenue Act of 1766. The Revenue Act was passed due to concerns of British merchants over how the Sugar Act affected their ability to do business with American merchants.

Primary Source Documents

Citation Information

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

  • Article Title The Sugar Act of 1764
  • Date April 5, 1764
  • Author
  • Keywords Sugar Act, American Revenue Act, American Revolution, Sugar Act Timeline
  • Website Name American History Central
  • Access Date May 22, 2024
  • Publisher R.Squared Communications, LLC
  • Original Published Date
  • Date of Last Update February 22, 2024