British revision of hated tax is announced

April 24, 1991|By Gilbert A. Lewthwaite | Gilbert A. Lewthwaite,London Bureau of The Sun

LONDON -- The government of Prime Minister John Major unveiled its replacement yesterday for the unpopular poll, or head, tax. The new method of funding local government will be a property-and-people charge based on the value of the home and the number of people living in it.

The new tax would be lower than either the poll tax or the earlier property tax, according to projections by the Conservative Party.

Environmental Secretary Michael Heseltine said it would be fair because those in the most expensive property would pay twice as much as those in the cheapest of seven "value bands." It also should be easier to collect because households rather than individuals will be billed, he said.

"It will not impose excessive demands on any household. It will make a clear connection between what councils spend and what people pay," he told the House of Commons, bringing cheers from Conservative members, relieved to be rid of the poll-tax millstone.

For the opposition Labor Party, tax spokesman Bryan Gould condemned the new tax as "a mongrel tax, the parents being the poll tax and political panic."

Voters are to pass judgment on the switch at nationwide local council elections May 2. The result will be decisive to the timing of the next general election, which Mr. Major must call by June 1992.

Current betting is that he will wait until this fall, at the earliest, t gain the benefit from a possible economic recovery.

The poll tax, a flat levy on every adult, rich and poor alike, was roundly rejected as regressive, bearing no relationship to a person's ability to pay. It played a major role in Margaret Thatcher's ouster last year, and months of hesitation over how to replace it opened Mr. Major to charges of "dithering."

But as Mr. Major sought to retreat from one political problem, he came under sustained attack over another.

Peter Morgan, director-general of the pro-Conservative Institute of Directors, blamed the government for failing to curb inflation earlier.

"The business recession of the last decade was torpedoed by runaway inflation. This awful recession, which is causing so much grief, is a failure of government economic management," he said.

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