Against the grain: Scotland pays the English Exchequer

It was regarded as oppressive to Scotland – tax that is – the malt tax in particular was exercising minds over what was seen as the high-handed treatment of Scotland almost before the ink was dry on the Union agreement.

To pay for their war with France the English government had introduced a malt tax and when the Union was agreed Scotland was temporarily exempted from it.

Between 1713 and 1724 the malt tax was expected to be a temporary tax which was voted for or against annually. But it was imposed on Scotland ‘with great difficulty’ to the extent a ‘Scotch peer had moved in the other House to dissolve the Act of Union’ – and the vote was tight with 55 voting on each side of the proposition that the Union be dissolved.

Article 14 of the Treaty of Union of 1707 specified that no part of the UK would be burdened unfairly with duties but that due regard would be made to particular circumstances and ability to meet responsibilities. Yet only six years after the Union what had been the English parliament and renamed the British parliament did –

‘actually impose a heavy burden upon Scotland, without any regard to the circumstances of the case, viz. the inferiority of Scotch grain, or the ability of the people , in that part of the United Kingdom, to pay a tax, which in several places was nearly equal to the value of the raw article.’

In other words a tax was imposed on Scots farmers that amounted to almost the value of their crop of bear barley. Bear barley was the principle type of barley grown in Scotland because of its climate and soil conditions, to an extent, but it was not as productive or as valuable as barley grown in most of England.

Support for the Jacobite rebellion of 1715 to return the Catholic Stuarts to the throne of Great Britain was boosted by resentment over the London government’s high-handed treatment of Scotland and the crushing fist of the Hanoverian monarchy. That Hanoverian crushing fist was liberally applied to Highland Scots at Culloden and in the brutal aftermath with Hanoverian redcoats unremitting campaign of rape and slaughter when forts, roads and bridges were constructed throughout Highland Scotland to more effectively control and repress the population -which they did successfully.

With the Jacobite rebellion suppressed and voices questioning Scotland’s treatment within the Union bludgeoned into silence the malt tax could be imposed without fear. In 1725 some consideration was paid to Scotland’s problems paying the tax and differential taxes were temporarily introduced with Scotland paying 3d to England’s 6d on a bushel of malt. But sixty years on arguments over the government’s unfair treatment of Scotland raged on.

Scots famers resisted the tax by not informing excise officers they were growing barley and refusing them admission to their grain lofts. And for most of them they had the support of local justices of the peace.  The tax led to riots and their brutal suppression which resulted in deaths and transportations. 

The Scots clergy, however, who had been exempted from all taxes on what was grown in their glebes (land attached to manses on which various crops were grown to provide food and income for ministers and perhaps local people) and who had never been charged any malt tax before volunteered to pay nominal sums to prevent more unrest among their countrymen and women. This squirming hypocrisy was seen as betraying the interests of Scotland – that driven by their hatred of Catholicism they were content to support the Protestant Hanoverian monarchy – brought in to keep the Catholic Stuarts out of power.

Not many Scots were in favour of the Union – not that they had any say in the matter and from its inception it was apparent Scotland far from being an equal partner would be subordinated to larger England whose parliament became the Union parliament with all of its traditions retained as if it was still English.

Over half a century after the imposition of the malt tax complaints raged on that Scots were effectively paying twice as much tax as the English.

Here’s a flavour from the Paisley Herald and Renfrewshire Advertiser in 1867 –

‘A certain class of English newspaper writers, and of Englishmen generally, can never be made to understand why Scotsmen should ever speak of Scottish rights, or have any notion beyond being regarded as a somewhat insignificant appendage to England.’

The author referred to the Union as a source of tension between Scotland and England and the levying on taxes imposed by an English-biased parliament. Obviously before the Union Scotland had its taxes and England its own taxes so everyone was happy, or not.

From the Union taxation was decided by what was still regarded as fundamentally the English parliament and the author went on to state that London treated Scotland as if she –

‘were a conquered country, in so far as it (Scotland) has been heavier taxed than the other divisions of the larger and wealthier neighbour.’

The issue of the malt tax still figured among complaints – the annual tax that had become a permanent tax with its detrimental impact on Scotland (and Ireland) – more so than in England. The argument was now less on the quality and value of barley grown in each of the nations than on what barley, or rather its malt, was made into.

Scots and Irish people when not drinking water – remembering that drinking water was often polluted before piped supplies made it into homes (for many that was not until the 20th century) so they drank whisky. In England beer was the national drink. It wasn’t that people drank all day and night but those were the national drinks (tea, coffee and cocoa were expensive luxury imports and the majority of people could not afford to buy them.)

Malt in Scotland and Ireland was used to produce malt spirits – whisky. This didn’t happen in England. Malt spirits or whisky was therefore being taxed by the Exchequer through the malt tax which given whisky’s importance in the diet of Scots and Irish penalised them far more than English consumers.

The consumption of malt and grain spirits in Scotland, England and Ireland for the year ending 31st December 1866 and the revenue derived from them through the duties paid were –

In England 9,515,040 proof gallons; pop c 20 million
In Scotland 7,691,760 proof gallons; pop c 3 million
In Ireland 5,910,061 proof gallons pop c 6 million

The rates of duty were similar in all three countries i.e. 10 shillings per proof gallon making the amount of duty paid in England £4,757,520; in Scotland £3,845,879; in Ireland £2,955,031.

Taking the population of each country into account this worked out per head of population per gallon tax as –

England paid tax of 4 shillings 9 penny
Scotland paid tax of £1- 5 shillings 1 penny.
Ireland paid tax of 10 shillings

Scots were paying far more per head of population than the English. It was said that the English people would not have stood to be treated so unfairly as to pay greater tax than the people of Scotland and Ireland.

‘That any nation should be made to pay at the rate of £1.5.1 a head on a single article of consumption is unparalleled in the annals of taxation, and no Legislature in the world ever made such an unfair and unjust use of its power as has the Parliament of the United Kingdom.’

What would English people say if they were compelled to pay a tax of £1 a head for their ale? They would not stand for it and nor should they. But Scots were being unjustly taxed and their complaints fell on deaf ears inside the parliament in London.

It was argued at the time that if the English were taxed on their national beverage – beer – at the same rate Scots were taxed on their national beverage whisky – high duties on tea and sugar and other commodities which made them too expensive for the majority of the population could be reduced to make them affordable.

From England the argument came that it was a matter of choice what Scots drank and they could drink beer so their complaint of being unfairly taxed did not stand scrutiny. This failed to tackle the question of why one drink in one part of the Union was targeted to be highly taxed while another was not, notably England’s drink.

Given it was the Scottish beverage that was taxed at a higher rate and the tax collected in Scotland in proportion to the population was greater then Scotland should be relieved of the burden of taxation on other taxes, it was argued. Instead Scots paid the penalty of their whisky being targeted for high taxation and were forced to pay the same rate for taxes which were made common across the Union – in essence they were being dealt a double whammy tax obligation.

‘Were the case reversed it would amount to this, that the people of England would pay £20,000,000 more of taxation than they do, and the people of Scotland would pay not more than two fifths of what they at present contribute to the national revenue. This would amount to £1 per head saving in Scotland imposed through the special whisky taxation.’

Suppose, it was asked, that England was a whisky nation and Scotland a beer nation would it be likely the duty on whisky would have been 10 shillings a gallon and no duty on malt liquors i.e. beer? The opposite would be the case it was argued – ‘Englishmen would never have submitted to be taxed £1 a head higher than Scotsmen.’

Why do Scots submit to such gross injustice?

‘We are sometimes taunted as a nation, by English writers, for our inadequate provision for the poor, but the additional taxation wrung from us by a Parliament in which there are nearly eight Englishmen for every one Scotsman would double that provision, and leave the whole of the eight hundred thousand pounds assessed for that purpose in the pockets of ratepayers.’

There were Scots MPs in the London parliament but they were accused of not being much interested in sticking up for Scotland unlike many Irish MPs who argued in the interests of their country. On the subject of the unfair taxation laws Scots MPs were largely silent.

High taxation of malt spirits led to illicit distillation – making their national drink affordable to Scots and so criminalised them.

We no longer have a malt tax as such but whisky is still taxed at high levels – currently around 76% of the price of a bottle of whisky is tax that goes to the Exchequer in London. Every day the London government collects around £9 million from spirit drinkers in the UK.

I suppose the government in London saw it could get away with the malt/whisky tax paid by Scots to enhance the services and infrastructure around London and so when North Sea oil and gas came along in Scottish waters it was a lesson well learned that the Scots could be ripped off without their MPs complaining. And they were right.

Tags: Act of Union, English parliament, malt tax, Scotland, taxation, taxes, Union, whisky