British position on the American Stamp Act
Proponents of an American Stamp Duty were found on both sides of the Atlantic but most supporters were in Britain. One of the most vocal British opponents on the American tax was William Pitt, the Earl of Chatham, who led Britain to victory during the French Indian War. Edmund Burke, a statesman and philosopher, strongly opposed the tax and supported American independence. Most British merchants also opposed taxation.
British expenditure during the French Indian War, that concluded with the Treaty of Paris on February 1763, doubled Britain’s debt. During that period the government borrowed heavily, about four-fifth of the total amount raised to finance the war, and one-fifth was raised through taxes. The annual cost of maintaining the army in the thirteen colonies before the war was £13,000 sterling. The cost of the additional 15 battalions in North America after the war escalated to £220,000. The colonies opposed to pay for their own defense so a tax to raise revenue would ensure colonist provided for their common defense.
Source: Alvin Rabushka, "Taxation in Colonial America", 725. Princeton University Press.
1739 46,954,623 5,820,000 5,210,000
1748 78,293,313 7,199,000 11,943,000
1755 74,571,849 6,938,000 7,119,000
1762 146,682,844 9,459,000 20,040,000
1775 135,943,051 11,112,000 10,365,000
The gap between taxes paid by colonial residents and British inhabitants was intolerable for parliament. For instance each Massachusetts resident paid 2s, Connecticut under 1s, Rhode Island 1.5s, and New Hampshire 1/4s. The per capita tax per British inhabitant was 34.5s.
The following were the most important supporting arguments of the British to legislate for a tax to raise revenue from the American colonies.
- The most important argument was that the increased cost of servicing the debt would increase the burden on British taxpayers. Taxing consumer goods would affect the poor who could resort to rioting. Taxing manufacturing would affect the country’s competitiveness in overseas markets.
- America was a prosperous colony providing a growing market for British exports. After the French Indian war exports to America reached a high of 25% of total British exports, therefore America was sufficiently prosperous to pay for its own defense.
- Securing the land west of the Appalachians required additional military presence in America.
- Smuggling in the colonies was rampant and enforcement of trade laws was weak. Postponing a new tax would give the Americans more time to organize opposition so the sooner it is enacted the better its chance of success.
- As British subjects, colonial residents enjoyed the rights of Englishmen and were given the freedom of self government and raising internal revenue. However, their colonial legislatures were subordinate to British Parliament. There was no question about the legality of taxation.
 Patrick K. O’Brien, “The Political Economy of British Taxation, 1660-1815”, Economic History Review.
 Alvin Rabushka, “Taxation in Colonial America” 796. Princeton University Press.
 Historical Statistics of the United States: Earliest Times to the present, vol. 5, part E, “Governance and International Relations. Cambridge University Press, 2006.