How Taxes Work

A common complaint goes like this:

"It always seems to happen when I've got 100 tools in a coastal colony in order to finish a building. I could then have a tea party, dump the tools into the ocean and not be able to buy tools in Europe anymore, which isn't handy early game. But I also don't like paying taxes."

It is not bad luck. The game does not pick the Tea Party good at random. Tools come up so often because of a fixed rule, and you can plan around it. This guide explains what tax actually costs you, when the King can raise it, how the Tea Party good is chosen, and how to keep your tools.

For the market itself (prices, how they move, what a sale earns), see How Europe Works.

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At a glance #

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1. What tax actually costs you #

Tax is taken only when money comes to you from Europe:

So a raise costs you exactly that many percent of every future sale. It does not make anything you buy more expensive.

This matters most early in the game. In the first few decades most players buy far more than they sell: tools, horses, colonists. At that stage a 1- or 2-point raise costs you almost nothing. It starts to hurt once you are shipping furs, silver, cigars or cloth to Europe every few turns.

A higher rate also has two side effects that help you:

• It makes later raises smaller. Every point of tax takes 5 off the King's score (see below), which pushes him away from the +5–8 Stamp Acts.
• Thomas Paine adds your tax rate as a percentage to every colony's liberty bells. See Thomas Paine.

The tax you pay goes into the King's war chest, which pays for the Royal Expeditionary Force. See How fast it grows.

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2. When the King can change the rate #

The King's regular tax event can only happen when all of these hold:

• you have at least one colony;
• it is turn 30 (1522) or later;
• the turn number is an exact multiple of the tax period;
• your tax is 85% or less. (The rate can never go above 75%, so in practice this never stops him.)

The period depends on the difficulty level and shrinks as the years pass:

Before 1600 the game moves one year per turn and turn 0 is 1492, so the years when a tax event is possible are fixed:

The event is decided at the start of that turn, before your colonies produce anything. What counts is what was in your colonies when you pressed End Turn on the turn before.

How big the change is #

When the King acts, he rolls a score:

score = random 1–1000 − 5 × tax rate + your population + gold ÷ 100 + turn ÷ 30 + 10 × rebel %

The wedding can only happen 30 times in a game, counted across all nations. After that, a score in its range gives the war raise instead. At 0% tax a "victory" roll does nothing at all, so early in the game nearly every event is a raise.

What pushes the score up:

• Rebel sentiment. Each 1% adds 10 points. At 50% rebels a cut is impossible and Stamp Acts become common.
• Gold in the treasury. Every 100 gold adds 1 point. Spending your gold before a tax year lowers the score a little.
• Population and the turn number, slowly.

What pulls it down: your current tax rate, 5 points per percent.

Other ways the rate changes #

• The King's frigate. When enemy warships threaten your shipping and you have no frigate, the King offers one every 8 turns. Accepting raises your tax by 10. This is an ordinary raise, so it can come with the Tea Party option. If you hold the party you keep the frigate and refuse the tax.
• Losing that frigate is meant to earn you a tax cut, but the amount is read from the wrong table entry. See How Europe Works.
• Cheat mode. With the cheat menu on, [ and ] on the Europe screen lower and raise your tax by 1.

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3. How the Tea Party good is chosen #

Every time the King raises your tax, the game looks for a good your colonists could throw into the harbour. Cuts never offer a Tea Party. If it finds one, the announcement gets a second answer such as "Hold 'Boston Tools Party'".

Step 1: each good gets a weight #

The weight comes from your trading history in Europe: the net tons of that good you have sold there, minus the tons you have bought there. It does not matter which way it leans. Buying 300 tons counts the same as selling 300. That figure is divided by 100, rounded down, and then:

Custom house sales count as Europe sales here too. Goods lost from a full warehouse do not count.

Step 2: the game looks at coastal colonies #

Only coastal colonies are searched, and only goods that are not already boycotted. For each good the game notes the coastal colony that holds the most of it.

Step 3: it takes the last good in market order #

The market lists the goods in this order:

food, sugar, tobacco, cotton, furs, lumber, ore, silver, horses, rum, cigars, cloth, coats, trade goods, tools, muskets

The game picks the last good in this list that is in stock in a coastal colony and has a weight above zero. The weights do not act as odds. Nothing is random. A good with weight 1 beats a good with weight 50 if it comes later in the list.

If no stocked good has any weight yet, the game picks the first stocked good instead, which is usually food.

Why it is always the tools #

Tools are 15th of 16 in the list. Only muskets come after them. You need a net 200 tons of tools traded in Europe to give them a weight. Most players buy that much in the first few decades.

From then on, whenever a coastal colony has tools in its warehouse during a raise, the Tea Party good is tools. The one exception is muskets, if a coastal colony also stocks some and you have bought or sold a net 400 tons of them. The colony named is the coastal colony with the most tools, which is usually the one saving up for a building.

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4. What the Tea Party does #

The party is optional. If you pick the first answer you simply accept the raise.

If you hold the party:

While a good is boycotted:

• You cannot buy or sell it in Europe, by hand or by trade route. "Unload" sells everything else and leaves the boycotted cargo aboard.
• You cannot equip or strip the matching unit on the docks: tools stop pioneers, muskets stop soldiers, horses stop scouts and dragoons.
• Your custom houses ignore the boycott and keep selling the good.

Lifting the boycott #

Click the boycotted good in the Europe market. Parliament demands back taxes of 500 × the good's current ask price. You pay in full or nothing happens.

Jakob Fugger lifts every current boycott for free, once. See Jakob Fugger.

Computer players never hold Tea Parties.

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5. What to do about it #

Keep the tools out of the warehouse on tax years #

Only goods in a coastal colony's warehouse can be picked. Tools on a ship, in a wagon train or in an inland colony are invisible to the Tea Party check. The tax years are fixed (see section 2). So at the end of the turn before one:

• load the tools onto a wagon train or a ship standing in the colony, and unload them next turn; or
• keep your building stock in an inland colony.

The offer then moves to the next good down the list that you have traded and are holding, such as trade goods, coats, cloth, cigars, rum or silver. If none of your stocked goods have a weight, it falls back to the first stocked good. Check the offer before you answer: it may now name a good you sell every trip.

Decide whether to pay or to party #

Ask what the raise will cost over the rest of the game, and compare that with getting the good back.

• Accepting costs that many percent of everything you will sell in Europe from now on. Early in the game, when you mostly buy, a +1 or +2 is nearly free.
• A tools party costs the 100 tools and about 1000 gold in back taxes to lift. You also get 100 bells in that colony, which you keep even after paying the back taxes.

Rules of thumb:

• Accept small raises early. +1 and +2 cost little while you are still buying. Your higher rate also takes 5 to 10 points off the next roll.
• Consider a party for a Stamp Act (+5 to +8) or the frigate's +10. If you expect to sell 20,000 gold of goods in Europe over the rest of the game, an 8-point raise costs about 1600 gold. Dumping 100 tools and paying 1000 to lift the boycott is cheaper, and the colony gets 100 bells.
• Tools are the cheapest boycott to lift. Their ask is so low that the back taxes are small. A boycott on furs, sugar or cloth costs several times as much.
• Muskets and horses are worth protecting. A boycott on them stops you arming soldiers and dragoons in Europe. The same hiding trick works for them.

Tip: Late in the game, with your rebels high, nearly every tax event is a big raise. A Tea Party on a good you no longer buy or sell in Europe, perhaps because a custom house now handles it, refuses the raise for free. You can steer the offer to that good by keeping the later goods in the list out of your coastal warehouses on tax years.

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Sources #

All of this comes from the reconstructed C source in matched/game/.

These findings are for the Windows release. The DOS version is believed to behave the same but has not been checked line by line.