I always knew what it meant, but I didn't know the origin.
Meaning: To pay a high price; to pay dearly.
Origin: Comes from the ninth-century Ireland. When the Danes conquered the Irish, they imposed an exorbitant Nose Tax on the island's inhabitants. They took a census (by counting noses) and levied oppressive sums on their victims, forcing them to pay by threatening to have their noses actually slit. Paying the tax was "paying trough the nose."