When states impose heavy taxes on internationally traded goods, who ultimately bears the cost? This paper examines the distributional effects of the Spanish Crown’s escalating export duties on fine wool between 1764 and 1792, tracing the fiscal incidence through the commodity chain linking Castilian growers to French woollen manufacturers. Drawing on aggregate price series and micro-historical evidence from the Madrid firm Dutari Hermanos and the French manufacture Grandin, it argues that the burden of Bourbon fiscality was not neutrally distributed. Its incidence was instead determined by power asymmetries: growers successfully defended a high domestic price floor, while French manufacturers imposed a ceiling on import prices as demand for finished cloth weakened in the late 1780s. Trapped in-between, merchants functioned as the chain’s shock absorbers until the Revolutionary Wars rendered the trade untenable. These findings challenge the assumption that merchants invariably captured the biggest share of value in early modern commodity chains and demonstrate that tax incidence analysis offers a powerful tool for uncovering the power relations structuring value distribution in international trade.