Poll tax was a policy too far for Margaret Thatcher

Morning View
Morning View

The newly-released Whitehall papers from the mid-1980s have shed light on the political disaster known as the poll tax.

The debacle, which contributed to the downfall of Margaret Thatcher, is sometimes depicted as an example of her ideological extremism.

In truth, the first female prime minister was notably cautious for the early part of her premiership and shied away from battles over issues such as welfare.

It was only in Mrs Thatcher’s second term, for example, that she felt secure enough in her position to take on the miners.

The idea behind the community charge, as the poll tax was titled, was not unreasonable: that each adult in a local authority would be liable for tax rather than each domestic property.

The intention was to make the tax harder to evade and align household contributions more closely with the number of people who might benefit from local services (if five adults live in a house and are benefitting from services such as leisure centres, it makes sense that they pay more than single person households in which there is only one beneficiary).

The Tories also hoped that the tax would make costs more transparent to voters, in that a higher per capita tax bill would be easily contrasted with a lower per capita one, and that this might drive down spending in some councils.

But in practice the poll tax was disastrous: it was perceived as deeply unfair that one person living in a mansion would pay a fraction of the local tax bill of five people in a council house.

It seemed to voters to be a pet project of Tory toffs, and triggered riots and mass non-payment and was scrapped by Mrs Thatcher’s successor at 10 Downing Street, John Major.

If politics is the art of the possible, the poll tax was barely so. It showed how pragmatic Mrs Thatcher had hitherto been.

Her younger advisors, such as the outstanding Oliver Letwin (then in his 20s), were bullish backers of the scheme. But her older advisors, such as the brilliant Nigel Lawson (then in his 50s), foresaw the political catastrophe that came to pass.