The French and Indian War proved extremely expensive. In fact, Prime Minister William Pitt nearly bankrupted Parliament to pay for fighting a war overseas. Parliament enacted the Sugar Act in 1764. The Sugar Act imposed new duties (taxes) on American commodities such as sugar, molasses, textiles, coffee and indigo. Unlike previous taxes, this tax was enforced and accused smugglers were prosecuted. American colonists were enraged by the Sugar Act because they did not think they should be taxed in the same way British residents were. For the first time, as the Virginia House of Burgesses asserted, the famous words, "no taxation without representation" were uttered. American colonists argued that they should not be subjected to taxes unless they had elected representatives in Parliament.

To make matters worse, Parliament passed the Stamp Act on March 22, 1765. The Stamp Act required Americans to purchase tax stamps for any printed documents including newspapers, legal documents, marriage licenses and more. On March 24th, Parliament passed the Quartering Act which required Americans to provide housing and provisions to British soldiers. Colonists wondered why troops were being sent to America after the French and Indian War. Many believed the troops were sent over to suppress freedoms Americans had enjoyed.

Opposition to the Stamp Act was universal. In 1765, the Massachusetts General Court organized opposition to the Stamp Act. Representatives from nine colonies drafted a petition calling for the repeal of the Stamp Act. Street mobs, calling themselves the Sons of Liberty, destroyed royal offices in Massachusetts and New York. When the Stamp Act was to be officially implemented, on November 1, 1765, all stamp agents sent over from England had been intimidated into resigning their posts. Meanwhile, Americans increasingly imported goods illegally which caused British merchants and manufacturers to lose business. Some, such as Samuel Adams, began to call for independence because Parliament had exceeded its authority. In March of 1766, Parliament agreed to repeal the Stamp Act, but passed the Declaratory Act which reaffirmed their right to pass any law in America.