Treasured belongings, including the duke’s fishing rods and even his dog’s basket were put under the hammer last week. In all the sale raised £5m, five times the expected amount.

The money was needed to pay death duties introduced by Harold Wilson. But the debt was deferred until the death of his wife, Princess Alice, who died in 2004, aged 102.

It was the most significant royal collection to go to auction since that of the Duke and Duchess of Windsor in 1988.

The sale, held at Christie’s in London, by the present Duke of Gloucester was made necessary by the 1969 Finance Act which levied 75% inheritance tax for an estate worth more than £500,000.

By contrast, the Queen Mother’s estate passed to the Queen in 2002 without the payment of any inheritance tax, under the “sovereign to sovereign” rule.

When the duke died, his will left the use of the family’s country home, Barnwell Manor in Northamptonshire, and his possessions to Alice for her lifetime. She lived for another 30 years.

In announcing the sale, the present duke observed that it was a consequence of the Harold Wilson era. “I couldn’t have afforded to pay it in 1974,” he said. “With the sale, the more that is made, the more goes to the government. There can't be many people left for whom those tax rates apply."

Under current inheritance tax laws, a widow is exempt from tax on any inheritance from her husband, and, because Alice survived to an era of lower tax rates, the estate might have expected to have attracted a 40% inheritance tax rate.

Mike Warburton, senior tax partner at Grant Thornton, explained: “The late duke died under the estate duty regime but it seems a heritage property election was made under which tax was not paid at that stage but would be payable at the death of the duchess.”

Rarely have so many items with a royal provenance been released on to the market. Queen Victoria’s christening present of a silver rose bowl to the late duke was sold for £15,000, and Queen Mary’s confirmation present of a silver tray to the late Prince William, the duke’s son, fetched £6,500.

Other items included Queen Mary’s breakfast trays, Kaiser Wilhelm II’s christening present to the late duke — a silver gilt beaker — and a collection of hand-coloured fans.

The highest price was commanded by an illuminated 15th-century manuscript, realising £198,000. It is known as The Master of Game and was once owned by Horace Walpole, the 4th Earl of Oxford. Two silver George III wedding tureens went for three times their estimated price at £142,000.

One successful bidder, Gay Murphy, from north Wales, secured a christening present given to the late William in 1942 for £1,800. She said: “I have a godson called William and I fell in love with the name. I am the number one royalist from the principality.”

The sale revealed the late duke to have had an investor’s eye for sporting pictures, prints and books.

It was in part because of the abdication of his brother, Edward VIII, that the collection started. Prince Henry, Duke of Gloucester, was needed for royal duties and had to abandon his military career.

He persisted in his collecting, despite the grumbles of Alice. She wrote in her memoirs: “His favourite bookseller never much appreciated me coming, as I would question some of his prices, whereas Prince Henry paid whatever was suggested without a murmur.”

The duke was the third son of King George V and Queen Mary and the last prince to be photographed as a baby on Queen Victoria’s lap.

The present duke and duchess, together with Princess Alice, left Barnwell in 1995 for Kensington Palace. It was here that the duke gave away his daughter, Lady Davina Windsor, in 2004 to Gary Lewis, a Maori builder and surfer.

Afterwards the Maori haka, a war dance adopted as the warm-up routine for the All Blacks, was performed in the palace garden.

Additional reporting: Alex Delmar-Morgan

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