Financial policy

• One reason was the defeat of the American war of Independence
• Reasons?

  -value of exports declined

  -national dept risen to £242 million

  -needed to cut costs and raise taxes
• Smuggling policy was to cut the growing smuggling trade
• To cut the money smuggled he lowered the import duty on tea through the commutation act
• The Hoovering act meant smuggling vessels (boats) could be searched up to 12 miles out of sea
• outcome of smuggling policy - hard to do and less profitable and 1/5 of all imports were smuggles
• Taxes policy - indirectly taxed the rich on things like horses, wigs and hair powders
• Outcome of the taxes policy - treasury improves and raised the national dept by 10 million and created the money for the war with France after 1793
• Sinking fund policy - fund of money to meet emergency payments the government might have to make and a way to reduce dept
• Outcome of sinking fund - reduced the national dept by 10 million and money was available in government in time of crisis
• however the sinking fund only settled the long term debt and was only efficient in peace time and eventually cancelled