Prominent figures such as Benjamin Franklin and members of the pro-independence group known as the Sons of Liberty argued that the British Parliament did not have the power to impose a domestic tax. Public demonstrations erupted and the ensuing violence attracted widespread attention. The tax commissioners were threatened and resigned out of fear; Others simply failed to raise funds. As Franklin wrote in 1766, the “Stamp Act should be enforced by force.” When this was not possible, Parliament did not repeal the Stamp Act until a year later, on 18 March 1766. Britain responded to these new but erroneous assumptions about the colonies by attempting to extend British control and sovereignty over America, and these demands added another aspect to Britain`s desire to raise taxes. In Britain, there was a sense that the colonists were outside the responsibilities that every British had to assume, and that the colonies were too far removed from the heart of the British experience to be left alone. By extending the obligations of the average British to the US – including tax liability – the whole entity would be better off. Although the Stamp Act pursued a strategy that was a common means of fundraising in England, it sparked a storm of protests in the colonies. The colonists had recently faced three major taxes: the Sugar Act (1764), which imposed new customs duties on imports of textiles, wine, coffee, and sugar; the Currency Act (1764), which caused a sharp decline in the value of paper money used by settlers; and the Quartering Act (1765), which required settlers to provide food and shelter to British troops under certain circumstances. In the 1760s, more than 150 years after the founding of the first English colony in North America, the American colonies flourished.
The British Parliament decided to pass a series of laws between 1760 and 1775 that would create and/or increase taxes on goods, trade, and commerce in the colonies. Parliament passed the Stamp Act on 22 March 1765 to pay off a national debt of nearly £140,000,000 after the victory over the France in the Seven Years` War (1763). A year earlier, Parliament had passed the Sugar Act, the first measure to increase revenue. Both taxes promised disastrous consequences in a post-war economy. While the Sugar Act was only a tax on foreign goods, the Stamp Act taxed items in the colonies. Previously, only colonial assemblies were responsible for internal taxes.  The Stamp Act caused outrage among settlers and many began protesting the laws. The American colonies seemed to the British government to be severely undertaxed. Before the war, the colonists had most of what they had contributed directly to British revenues through customs revenues, but this barely covered the cost of collection. During the war, huge sums of British currency had poured into the colonies, and many of those who had not been killed in the war or conflicts with the natives had fared very well.
It seemed to the British government that some new taxes for their garrison would have to be easily absorbed. In fact, they had to be absorbed because there seemed to be no other way to pay the army. Few people in Britain expected the settlers to have protection and not pay for it themselves. Some British politicians pointed out that imposing taxes on unrepresented colonies violated the rights of every Briton, but there was not enough to overturn the new tax code. Even when the protests began in the United States, many in Parliament ignored them. This was due in part to the question of sovereignty and in part to the contempt for the settlers due to the experience of the Franco-Indian War. It was also partly due to prejudice, as some politicians believed that the colonists were subordinate to metropolitan Britain. The British government was not immune to snobbery. During the Seven Years` War, Britain had spent astronomical sums, both on its own army and on subsidies to its allies. Britain`s national debt had doubled in such a short time, and additional taxes had been levied in Britain to cover it. The last one, the cider tax, proved to be very unpopular and many people were campaigning for it to be abolished.
Britain also ran out of credit with banks. Under enormous pressure to cut spending, the British king and government believed that any further attempt to tax the homeland would fail. So they used other sources of revenue, one of which was to tax American settlers, to pay the army that protected them. The Stamp Act of 1765 was ratified by the British Parliament under King George III. He levied a tax on all official papers and documents in the American colonies, but not in England. Under the peace treaty, Britain gained new territories, including French Canada and French territory east of the Mississippi River. How would Britain repay its war debts and the additional costs of defending its expanded North American empire? How would American colonists react to British policy? Grenville lost his post when Britain was informed of developments in America and his successor, the Duke of Cumberland, decided to impose British sovereignty by force. However, he suffered a heart attack before he could order it, and his successor decided to find a way to repeal stamp duty while keeping sovereignty intact. The government used a dual tactic: asserting its sovereignty verbally (not physically or militarily) and then invoking the economic impact of the boycott to repeal the tax. The ensuing debate made it clear that British MPs believed that the King of Great Britain had sovereign power over the colonies, had the right to pass laws concerning them, including taxes, and that this sovereignty gave Americans no right to representation.