The American Revolution resulted in expensive war debts for the United States, leading to the need for revenue generation. With no income tax at the time, states resorted to raising money through import duties and selling land. This caused land prices to rise in the United States, while in British Canada, the British government subsidized the local government, keeping local taxes low and allowing them to offer free land to attract settlers. This strategy aimed to encourage Americans to leave the new Republic, strengthen Canada within the British Empire, and provide a militia for its defense.

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