Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, April 18, 1990 TAG: 9004180490
SECTION: EDITORIAL PAGE: A-6 EDITION: METRO
SOURCE:
DATELINE: LENGTH: Medium
Reagan was able to cut those taxes early in his first term as president, hobbled social programs by running up giant budget deficits, and left office nearly eight years later still hugely popular. Thatcher has been prime minister for 11 years and only now is putting in tax relief for the rich in order to hold down social spending. And the roof is falling in on her.
Tough and of chilly temperament, she has never enjoyed the kind of rapport with her citizens that Reagan had with Americans. She never could put a feel-good fuzz over her attitudes about such as the poor who ate up the taxes that others paid. But never before did her government embrace tax policies so openly discriminatory and that hit common people so hard.
In Britain, local governments long have financed their operations with a combination of grants from the central government and property taxes. For an equally long time, some in Thatcher's Conservative Party have complained about paying such taxes so as to finance programs such as public housing (whose tenants tend to vote for the Labor Party). Well before she became prime minister, Thatcher was promising not to reform this tax system but to abolish it.
That took time, but on April 1 property taxes went out and were replaced by what she calls a "community charge," an obvious euphemism. Britons high and low will now pay a poll, or per capita, tax for local services such as street maintenance, lighting and garbage pickup. The amount will vary from one community to another. But within a community each resident will pay the same, and the tax has nothing to do with ability to pay. Says Newsweek magazine:
"It is unashamedly a regressive tax. Squires will pay the same as saddlemakers. The old rate for Princess Anne's Gatcombe Park estate was reportedly almost $10,000. Now, like everyone else, she will pay $606. At the other end Ronald Reagan once said `taxes should hurt,' but he did his best to assure that they hurt as few as possible. Thatcher has done rather the opposite. is 60-year-old Sid Hope, a youth worker from Lambeth. His family of four paid about $970 in property taxes; now each will pay that much alone."
Small wonder the eve of the tax's effective date brought demonstrations, some of which escalated into riots in which scores were injured. Thatcher has other political problems - for a couple, inflation and interest rates are up - and if there were an election today, her party would be turned out of power in favor of Labor. She counts on the fact that there does not have to be an election until the summer of 1992; by then, memories of the new tax's impact may have faded enough to salvage her party's position.
Ronald Reagan once said "taxes should hurt," but he did his best to assure that they hurt as few as possible. Thatcher has done rather the opposite. Her purpose, observers say, is not just to ease the burden of the rich but also to make plain to residents of every community just how much their local services cost. And by shifting pain to local councils, many of them controlled by Labor, she hopes to reduce their influence.
Reagan was able to realize his agenda of tax-cutting and reduction of social outlays by spreading the immediate financial benefits; only those at the ladder's bottom would really feel the effect of the cutbacks. There are greater class differences in Britain, and it becomes difficult to hide or overlook the element of class warfare in Thatcher's latest move. She has overcome many earlier difficulties. But by rousing resentment over taxation, she may have sown the seeds for her overthrow at the polls two years from now.
by CNB