The Tea Act 1773 (13 Geo. 3. c. 44) was an act of the Parliament of Great Britain. The principal objective was to reduce the massive amount of tea held by the financially troubled British East India Company in its London warehouses and to help the struggling company survive. A related objective was to undercut the price of illegal tea, smuggled into Britain's North American colonies. This was intended to convince the colonists to purchase Company tea on which the Townshend duties were paid, leading the colonists to implicitly agree to Parliament's right of taxation. Smuggled tea was a large issue for Britain and the East India Company, since approximately 86% of all the tea in America at the time was smuggled Dutch tea.
The act granted the Company the right to directly ship its tea to North America and the right to the duty-free export of tea from Britain, although the tax imposed by the Townshend Acts and collected in the colonies remained in force. It received the royal assent on May 10, 1773.
