The Tea Act: Full Text with Annotations

The Tea Act (13 Geo. 3, c. 44)

On May 10, 1773 the so-called Tea Act received royal assent and became law. The following is the full text of the act, with annotations to provide further understanding. You can find the full text here as well. I have maintained the original spelling and punctuation, but have modernized capitalization. I have changed the emphasis of the original, so that the text is entirely in regular upright text, with the following exceptions: I have italicized the titles of acts and I have added bold text to highlight the key point of each section. My commentary is in blue text.

First, a little background. At this time all tea consumed in Great Britain was being produced in China and the East India Company was the only entity allowed to legally import it from there. When they did they had to go straight to London with it and pay a 25% import duty. They then had to offer the tea for sale at a public auction (usually in small lots of a few chests at a time), where other merchants would bid on it. Whoever won the bidding purchased the tea from the Company and could sell it in Britain or export it to other parts of the British Empire. At the time of purchase the tea was subject to an additional duty of 25% plus 1 shilling per pound weight. Combined with the import duty, this resulted in about a 100% increase to the price of Bohea tea being sold in Britain.

Anno decimo tertio Georgii III. Cap. XLIV.

An act to allow a drawback of the duties of customs on the exportation of tea to any of his Majesty's colonies or plantations in America; to increase the deposit on bohea tea to be sold at the India Company's sales; and to impower the commissioners of the treasury to grant licences to the East India Company to export tea duty-free.

Preamble

WHEREAS by an act, made in the twelfth year of his present Majesty's reign, (intituled, An act for granting a drawback of part of the customs upon the exportation of tea to Ireland, and the British dominions in America; for altering the drawback upon foreign sugars exported from Great Britain to Ireland; for continuing the bounty on the exportation of British-made cordage; for allowing the importation of rice from the British plantations into the ports of Bristol, Liverpoole, Lancaster, and Whitehaven, for immediate exportation to foreign parts; and to impower the chief magistrate of any corporation to administer the oath, and grant the certificate required by law, upon the removal of certain goods to London, which have been sent into the country for sale;) it is amongst other things, enacted, That for and during the space of five years, to be computed from and after the fifth day of July, one thousand seven hundred and seventy-two, there shall be drawn back and allowed for all teas which shall be sold after the said fifth day of July, one thousand seven hundred and seventy-two, at the publick sale of the united company of merchants of England trading to the East Indies, or which after that time shall be imported, by licence, in pursuance of the said therein and hereinafter mentioned act, made in the eighteenth year of the reign of his late majesty King George the Second, and which shall be exported from this kingdom, as merchandise, to Ireland, or any of the British colonies or plantations in America, three-fifth parts of the several duties of customs which were paid upon the importation of such teas; which drawback or allowance, with respect to such teas as shall be exported to Ireland, shall be made to the exporter, in such manner, and under such rules, regulations, securities, penalties, and forfeitures, as any drawback or allowance was then payable, out of the duty of customs upon the exportation of foreign goods to Ireland; and with respect to such teas as shall be exported to the British colonies and plantations in America, the said drawback or allowance shall be made in such manner, and under such rules, regulations, penalties, and forfeitures, as any drawback or allowance payable out of the duty of customs upon foreign goods exported to foreign parts, was could, or might be made, before the passing of the said act of the twelfth year of his present Majesty's reign, (except in such cases as are otherwise therein provided for:) and whereas it may tend to the benefit and advantage of the trade of the said united company of merchants of England trading to the East Indies, if the allowance of the drawback of the duties of customs upon all teas sold at the publick sales of the said united company, after the tenth day of May, one thousand seven hundred and seventy-three, and which shall be exported from this kingdom, as merchandise, to any of the British colonies or plantations in America, were to extend to the whole of the said duties of customs payable upon the importation of such teas; may it therefore please your Majesty that it may be enacted; and be it enacted by the King's most excellent majesty, by and with the advice and consent of the lords spiritual and temporal, and commons, in this present parliament assembled, and by the authority of the same, That there shall be drawn back and allowed for all teas, which, from and after the tenth day of May, one thousand seven hundred and seventy-three, shall be sold at the publick sales of the said united company, or which shall be imported by licence, in pursuance of the said act made in the eighteenth year of the reign of his late majesty King George the Second, and which shall, at any time hereafter, be exported from this kingdom, as merchandise, to any of the British colonies or plantations in America, the whole of the duties of customs payable upon the importation of such teas; which drawback or allowance shall be made to the exporter in such manner, and under such rules, regulations, and securities, and subject to the like penalties and forfeitures, as the former drawback or allowance granted by the said recited act of the twelfth year of his present Majesty's reign, upon tea exported to the said British colonies and plantations in America was, might, or could be made, and was subject to by the said recited act, or any other act of parliament now in force, in as full and ample manner, to all intents and purposes, as if the several clauses relative thereto were again repeated and re-enacted in this present act.

[The Tea Act starts by referencing an act that it was in part replacing. That act was the so-called Customs Act of 1772 (12 Geo 3, c. 60), which granted a drawback (meaning a rebate or refund) of 3/5th of the duties owed on all tea imported into England, if the tea was then exported to Ireland or the American colonies. The Customs Act of 1772 went into effect on July 5, 1772 and applied to all tea sold at public auction or imported after that date. It was to last for five years, or until July 5, 1777. The Tea Act in 1773 replaced the parts of that act relating to the American tea trade.

The Tea Act also kept in force several clauses from the Customs Act (1772) that aren't explicitly laid out in the Tea Act. Those were:

• Tea must be exported directly from the warehouse where it was stored. (See 10 Geo 1, c. 10 and 18 Geo 2, c. 26)
• Tea may not be exported to Ireland or the American colonies in any vessel under 80 tons burthen.
• Tea may not be exported except in the same containers in which it was imported and in the same quantities that were sold at the EIC auction.

It should be noted that the Customs Act of 1772 had been implemented to replace a similar law that had expired. That was the Indemnity Act of 1767 (7 Geo 3, c. 56), which was one of the several so-called Townshend Acts. The Indemnity Act allowed a full drawback on the importation duties for all teas that were then exported to Ireland or the American colonies. It also completely suspended the inland duty of 1 shilling for all tea sold for consumption in England, and suspended all of the inland duties (the 1 shilling/lbs and the 25% duty) for tea exported. The Indemnity Act was also set to last for five years, ending on July 5, 1772.

With that additional background, we can begin to see what the Tea Act was intended to do. As stated above, it allowed a full drawback on the importation duties for all teas exported to America. Tea exported to Ireland remained under the rules of the Customs Act of 1772. The Tea Act went into effect on May 10, 1773 and did not have an expiration date, unlike its two predecessor laws.]

II. And whereas by one other act made in the eighteenth year of the reign of his late majesty King George the Second, (intituled, An act for repealing the present inland duty of four shillings per pound weight upon all tea sold in Great Britain; and for granting to his Majesty certain other inland duties in lieu thereof; and for better securing the duty upon tea, and other duties of excise; and for pursuing offenders out of one county into another,) it is, amongst other things, enacted, That every person who shall, at any publick sale of tea made by the united company of merchants of England trading to the East Indies, be declared to be the best bidder for any lot or lots of tea, shall, within three days after being so declared the best bidder or bidders for the same, deposit with the said united company, or such clerk or officer as the said company shall appoint to receive the same, forty shillings for every tub and for every chest of tea; and in case any such person or persons shall refuse or neglect to make such deposit within the time before limited, he, she, or they, shall forfeit and lose six times the value of such deposit directed to be made as aforesaid, to be recovered by action of debt, bill, plaint, or information, in any of his Majesty's courts of record at Westminster, in which no essoin, protection, or wager of law, or more than one imparlance, shall be allowed; one moiety of which forfeiture shall go to his Majesty, his heirs and successors, and the other moiety to such person as shall sue or prosecute for the same; and the sale of all teas, for which such deposit shall be neglected to be made as aforesaid, is thereby declared to be null and void, and such teas shall be again put up by the said united company to publick sale, within fourteen days after the end of the sale of teas at which such teas were sold; and all and every buyer or buyers, who shall have neglected to make such deposit as aforesaid, shall be, and is and are thereby rendered incapable of bidding for or buying any teas at any future publick sale of the said united company: and whereas it is found to be expedient and necessary to increase the deposit to be made by any bidder or bidders for any lot or lots of bohea teas, at the publick sales of teas to be made by the said united company; be it enacted by the authority aforesaid, That every person who shall, after the tenth day of May, one thousand seven hundred and seventy-three, at any publick sale of tea to be made by the said united company of merchants of England trading to the East Indies, be declared to be the best bidder or bidders for any lot or lots of bohea tea, shall, within three days after being so declared the best bidder or bidders for the same, deposit with the said united company, or such clerk or officer as the said united company shall appoint to receive the same, four pounds of lawful money of Great Britain for every tub and for every chest of bohea tea, under the same terms and conditions, and subject to the same forfeitures, penalties, and regulations, as are mentioned and contained in the said recited act of the eighteenth year of the reign of his said late Majesty.

[This section of the Tea Act makes reference to the Inland Duties, etc. Act of 1744 (18 Geo 2, c. 26). As stated, one of the things that act did was dictate the terms for securing chests of bohea tea that a merchant wins at the EIC auction, namly they had three days to deposit £2 sterling per chest or suffer penalties. The Tea Act changed those terms by doubling the deposit to £4 sterling per chest. The penalties for failing to do so remained the same. Those penalties were:

• A fine of six times the deposit (which would now be £24 per chest of bohea—roughly 2/3 the value of the chest)
• Very little wiggle room for the negligent depositor to contest the fine in court
• One half of the fine went to the monarchy
• The other half went to the Company
• The sale was voided and the tea put back up for auction within 2 weeks after the first auction
• The negligent depositor was barred from purchasing any tea again from the EIC

These are some pretty serious penalties, especially that last one. No doubt these are to ensure that any purchasers of tea are serious about their business.]

III. And be it further enacted by the authority aforesaid, That it shall and may be lawful for the commissioners of his Majesty's treasury, or any three or more of them, or for the high treasurer for the time being, upon application made to them by the said united company of merchants of England trading to the East Indies for that purpose, to grant a licence or licences to the said united company, to take out of their warehouses, without the same having been put up to sale, and to export to any of the British plantations in America, or to any parts beyond the seas, such quantity or quantities of tea as the said commissioners of his Majesty's treasury, or any three or more of them, or the high treasurer for the time being, shall think proper and expedient, without incurring any penalty or forfeiture for so doing; any thing in the said in part recited act, or any other law, to the contrary notwithstanding.

[As stated above, the EIC was barred from exporting tea from England. They could import from China, and then had to offer it up at a public auction in London. That was the end of the line for their role in the tea trade. Under the Tea Act, however, they were now given permission to export tea to America and to foreign parts without first putting it up for auction in London. This would allow them to bypass the middlemen merchants who typically carried on the tea trade across the seas. Presumably, this would allow for a lower price on their tea.]

IV. And whereas by an act made in the ninth and tenth years of the reign of King William the Third, (intituled, An act for raising a sum not exceeding two millions, upon a fund, for payment of annuities, after the rate of eight pounds per centum per annum; and for settling the trade to the East Indies,) and by several other acts of parliament which are now in force, the said united company of merchants of England trading to the East Indies are obliged to give security, under their common seal, for payment of the duties of customs upon all unrated goods imported by them, so soon as the same shall be sold; and for exposing such goods to sale, openly and fairly, by way of auction, or by inch of candle, within the space of three years from the importation thereof: and whereas it is expedient that some provision should be made to permit the said company, in certain cases, to export tea, on their own account, to the British plantations in America, or to foreign parts, without exposing such tea, to sale here, or being charged with the payment of any duty for the same; be it therefore enacted by the authority aforesaid, That from and after the passing of this act, it shall and may be lawful for the commissioners of his Majesty's treasury, or any three or more of them, or the high treasurer for the time being, to grant a licence or quantity of licences to the said united company, to take out of their warehouses such quantity or quantities of tea as the said commissioners of the treasury, or any three or more of them, or the high treasurer for the time being, shall think proper, without the same having been exposed to sale in this kingdom; and to export such tea to any of the British colonies or plantations in America, or to foreign parts, discharged from the payment of any customs or duties whatsoever; any thing in the said recited act, or any other act to the contrary notwithstanding.

[This section references the East India Company Act of 1697 (9 Will 3, c. 44), which established many of the regulations under which the EIC operated, and under which they maintained a monopoly on the East Indian trade. This section also coincides with the previous one. In addition to being able to export tea to America or foreign parts without suffering any penalty, the EIC would also be able to ship their tea free of the inland duty of 1 shilling per pound that was usually due once tea was sold at auction. This would also lower the price of the tea quite a bit.

The wording of this section was a source of confusion in the colonies. The phrase "discharged from the payment of any customs or duties whatsoever" did not explicitly state which customs or duties were intended. Some at first believed this phrase applied to the Townshend duty of 3 pence per pound that was due when tea was imported into America. However, it soon became clear that this phrase only applied to the inland duty owed when tea was sold at auction. The Townshend duty would remain in force.]

V. Provided always, and it is hereby further enacted by the authority aforesaid, That a due entry shall be made at the custom-house, of all such tea so exported by licence, as aforesaid, expressing the quantities thereof, at what time imported, and by what ship; and such tea shall be shipped for exportation by the proper officer for that purpose, and shall, in all other respects, not altered by this act, be liable to the same rules, regulations, restrictions, securities, penalties, and forfeitures, as tea penalties, &c. exported to the like places was liable to before the passing this act: and upon the proper officer's duty, certifying the shipping of such tea to the collector and comptroller of his Majesty's customs for the port of London, upon the back of the licence, and the exportation thereof, verified by the oath of the husband or agent for the said united company, to be wrote at the bottom of such certificate, and sworn before the said collector and comptroller of the customs, (which oath they are hereby impowered to administer,) it shall and may be lawful for such collector and comptroller to write off and discharge the quantity of tea so exported from the warrant of the respective ship in which such tea was imported.

[This section lays out the paperwork and bureaucratic procedures for exporting tea under the provisions of the Tea Act. In order to obtain the drawback (or rebate) of the import duties, it was necessary to make note of how much tea was being exported and to know when and by which vessel it was originally imported. This allowed the customs officers to trace the tea and make sure the payment of all duties was in order.]

VI. Provided nevertheless, That no such licence shall be granted, unless it shall first be made to appear to the satisfaction of the commissioners of his Majesty's treasury, or any three or more of them, or the high treasurer for the time being, that at the time of taking out such teas, for the exportation of which licence or licences shall be granted, there will be left remaining in the warehouses of the said united company, a quantity of tea not less than ten millions of pounds weight; any thing herein, or in any other act of parliament, contained to the contrary thereof notwithstanding.

[This final section is pretty straightforward. Before authorizing tea to be exported to America under the provisions of the Tea Act, the customs officers had to ensure that at least 10 million pounds of tea remained in the Company's warehouses. This is no doubt to ensure that a sufficient quantity remained for the domestic tea trade.]

[For further reading on the events leading up to the passage of the Tea Act, I highly recommend Benjamin Woods Labaree's definitive work on the subject The Boston Tea Party, published by Oxford University Press in 1964 and reprinted in 1979 by Northeastern University Press. Chapters 1–4 especially touch on this part of the story.]