Economic Developments: 1979 Budget Flashcards
Who was the Chancellor of the Exchequer from 1979-1983?
Geoffrey Howe
What did Howe do to interest rates in the 1979 budget?
They were put up to 14%
What was income tax cut to? What was it before?
Income tax was cut to 30%, it was previously 33%
What was the highest standard rate of income tax cut to? What was it before?
Income tax was cut to 60%, it was previously 83%
Why did Thatcher heavily cut higher rate income tax?
She believed it would offer an incentive for people in the normal income tax rate to improve their economic conditions
What did the 1979 budget put VAT up to? What was it before?
VAT was put up to 15%, it was previously 8%
What was the short-term impact of increasing VAT?
It increased inflation
What had inflation gone up by from 1979 to the end of 1980?
It had gone from 11% to 22%
What happened to interest rates in November 1979?
They were put up to 17%
How can it be seen that some Conservatives were doubting Thatcher and her Monetarist policies?
A Conservative backbencher denounced Thatcher in a letter to a left-leaning newspaper
