REVEALED: Thatcher warned over poll tax chaos
MARGARET Thatcher was warned that homeless people would try to dodge her flagship “poll tax” by giving up shelter to sleep on the streets.
The controversial tax was introduced in 1990, and led to Thatcher's downfall
Welsh Secretary Peter Walker told the Premier she should make those without homes pay the charge, newly released files from the 1980s reveal.
Mr Walker claimed that allowing the homeless an exemption would “put an enormous loophole” in the system and it would be abused.
The controversial tax – a flat rate “community charge” to fund local council spending – was introduced in 1990 but scrapped three years later.
He wanted to rethink the community charge. The Prime Minister discouraged this firmly
Now Whitehall documents released by the National Archives in Kew have revealed how worried some ministers were about the charge being dodged.
Mr Walker said: “It would act as an incentive to people to sleep rough simply to make sure that they escaped having to pay.”
He added: “A specific exemption could be seen as encouraging them to sleep on the street rather than in a hostel.”
Central London was host to riots sparked by the tax in 1990
The riots led to more than 100 police officers being injured
Mr Walker’s memo is among papers from the mid-1980s which show Whitehall’s reaction to the Tory leader’s plans for the tax to replace domestic rates.
She believed her system would deter high-spending Labour councils from putting up local taxes – hitting well-off Tory homeowners while their own voters were largely unaffected.
Even Environment Secretary Nicholas Ridley, who was given the task of steering the new policy through Parliament, was worried.
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He approached Mrs Thatcher in July 1987 to complain about the level of opposition he was facing from councils.
A Downing Street memo says: “Mr Ridley called to see the Prime Minister this evening.
"He mentioned his growing concern about opposition to the community charge.
Thatcher was warned that homeless people would dodge the tax by sleeping rough
“This would be increased by the decision to have a transition rather than to abolish rates immediately.
“He showed some inclination to want to rethink quite major aspects of the community charge. The Prime Minister discouraged this firmly.”
The charge met with almost universal political opposition because it was deemed unfair and bureaucratic.
It also sparked riots including one in 1990 which led to more than 100 police officers being injured in central London.
The tax is seen as one of the factors that led to Mrs Thatcher being ousted as Tory leader later the same year.
Her replacement, John Major, abolished the charge and brought in council tax, based loosely on the old rates system.