Why did MT resign as PM in 1990?

Why Did MT resign in 1990?

• The Four Reasons:
  • the impact of poll tax
  • economic difficulties
  • divisions over Europe
  • growing unpopularity/isolation

Poll Tax

• Local Govt Finance Act 1988= replaced the rates (tax on local owners of prpoerty + business) with a flat rate tax.
• First introduced in Scotland where millions did not pay in protest. Day before introduced, big riot in Trafalgar Square w/ 400 policemen injured.
• Pressed onwards despite warnings --> style becoming more dictatorial

Economic Difficulties

• October 1987 stock market crash wiped 24% of shares
• Lawson thought might trigger recession so reduced income tax rates
• this triggered consumer boom which pushed up up prices, forcing inflation to rise to 8.9% by 1989
• tried to control inflation by increasing interest rates, which increased to 15%
• mortgage owners (MT's…