Margaret Thatcher and the size of government
There are those who still believe that the Thatcher government (1979-1990) rolled back the state and cut taxes. In fact Thatcherism involved an increase in the proportion of national income passing through the state and an increase in the tax burden. Only income taxes went down, with great publicity — the more hidden taxes increased. Value Added Tax, a form of purchase tax, was increased and was by comparison with income taxes regressive, though not quite as regressive as the additional taxes which were levied on alcohol and tobacco…the Thatcher government, and indeed subsequent ones, ended up spending more in absolute and even in relative terms on welfare taken overall.
That is from David Edgerton, The Rise and Fall of the British Nation: A Twentieth Century. Here are my previous posts on the book and on other work by Edgerton.
