Recently we’ve heard a lot of talk from politicians wanting to introduce legislation to curb the amount of salt, sugar and fat in processed foods. We’ve even had former Labour minister Ben Bradshaw suggesting these ingredients should be taxed in an attempt to change what people eat.
Bradshaw possibly thought his was a radical new proposal but the idea to tax salt is nothing new. The history of salt is as old as our own and has frequently been a source of taxation, in fact, it’s probably been our most taxed commodity.
But one of the most remarkable changes in how salt was taxed came following accession of William III to the British throne in 1688. William was “strapped for cash” so brought over his Dutch accountants to solve his problems. They found the answer in applying heavy duties to alcohol and tobacco and a novel form of salt taxation. Under William, salt was for the first time taxed at the point of manufacture instead of at the point of use.
While we may complain about the taxes we have to pay today they seem generous compared to the tax on salt – it was several times the salt’s market value and was twice this rate on imported salt. It became such big business that in 1702 the Treasury set up a separate department, the Salt Office, just to collect the salt tax. And the Salt Tax, along with the Salt Act of 1702 that accompanied it, had a huge impact on changing the shape of salt manufacturing in Britain.
In what’s possibly a warning from history to the current government, the introduction of the tax suppressed the industry here but saw it boom elsewhere. As manufacturers and distributors looked for lower prices, Ireland, exempt from the Salt Tax, became a major producer and exporter of salt. The availability of untaxed white salt saw Irish butter-making grow so much that Ireland became the world’s largest butter exporter.
One swash-buckling side effect of the Salt Tax was the bootlegging of white salt from Ireland back to England. Salt smuggling, along with other forms of tax evasion, became such a problem that it undoubtedly contributed to the decline of sea salt making down the west coast of England.
And an interesting footnote, echoing the warning of Barbara Gallani of the Food & Drink Federation about the difficulties of introducing new legislation, it’s doubtful whether the revenue earned justified the enormous cost involved in the Salt Tax’s administration.