Case Study – The Poll Tax
The Community Charge, more widely known as the Poll Tax, was introduced by Mrs. Thatcher’s Conservative Government in Scotland 1989 and England and Wales 1990.
What was the Poll Tax?
The Green Paper of 1986, Paying for Local Government, produced by the Department of the Environment set out the proposed tax.
The ‘poll tax’ was a fixed tax per adult resident, although there was a reduction for poorer people, for the services provided in their community. This caused major administrative problems for local government. They had to identify every person in a household especially shared and student housing or those not on the electoral register. In addition, anyone employed paid 100% whilst those unemployed or in education paid 20%.
Riots, protests and refusal to pay
The most serious riot happened in London on 31 March 1990 shortly before the tax was due to be introduced. More than 200,000 protesters filled Whitehall and Trafalgar Square with over 100 police officers injured.
As the impact of the poll tax began to hit large numbers of people refused to pay. In some areas this was up to 30% making enforcement measures by local authorities very difficult. People were refusing to turn up at court hearings and the police were struggling to find the resources to arrest all defaulters.
The Labour Party, at its 1988 annual conference, decided against supporting the non-payment campaign although one MP, Terry Fields, Labour MP for Liverpool Broadgreen was imprisoned for non-payment. Labour leader Neil Kinnock commented: "Law makers must not be law breakers."
Margaret Thatcher: Political Consequences
The Conservatives began to struggle badly in the opinion polls and there was a consensus building that whilst the policy had to go; Margaret Thatcher had to go with it. Neil Kinnock put in his election manifesto that he would abolish the unpopular tax.
Michael Heseltine challenged Thatcher for the Conservative leadership in November 1990. Under the party rules, although she won by fifty votes, Thatcher narrowly missed the number to avoid a second vote. Seeing this as a sign of a lost mandate Mrs Thatcher resigned on 22 November 1990.
All three contenders to replace her said they would get rid of the Poll Tax, John Major the new PM, did just that on 21 March 1991. The eventual replacement was the Council Tax, which is still in place today.