Final answer:
The statement is true. Colonists objected to the way tax money was applied, particularly due to lacking representation in Parliament.
Step-by-step explanation:
The statement that colonists did not necessarily object to the principle of taxation, but rather how the tax money would be applied is true. The American colonists were concerned about their lack of representation in the British Parliament, which was levying taxes on them. This issue is encapsulated in the famous phrase "No taxation without representation". They believed that it was unfair for them to be taxed without having a say in how those taxes were implemented and used by the government.