This final chapter of the study is centred on the British income tax; the immediate build up, the tax itself, the immediate aftermath and contemporary developments in direct taxation in the colonies and, to a limited extent, the United States. In the usual way, the chapter is structured around historic events, which require some outline in order to facilitate a deeper understanding of context in which direct tax developments took place. Unlike the last chapter and the latter part of Chapter 3, the war around which this chapter is centred was, for Britain, more clearly focused at home. That is not to say that the colonies were not involved to a substantial extent in the war but, rather, that the war threatened British home security in a more serious way than the previous two wars, in a way not seen since the War of the Grand Alliance. The result, as in the latter and earlier wars involving such a local threat, was dramatic, even frantic development in direct taxation.

The chapter is structured around three headings, which centre on two important treaties: the Treaty of Campo Formio of 1797 and the Treaty of Amiens of 1802. The first of these is important not because Britain signed it but because it was not a party to the treaty and as a result was left alone in the battle against France. Britain was a party to the second treaty, which resulted in a short respite in the war with Napoleon.