LONDON -- A squabble enmeshed the ruling Conservative Party Thursday over a warning to Prime Minister Margaret Thatcher by a main rival that her poll tax plan is seen as unfair and could cost the party the next election.
Michael Heseltine, a member of Parliament and a possible successor to Thatcher, wrote in The Times newspaper that the poll tax, or community charge, should be graded by income.
Local councils should be forced to call an election if they set the tax too high and exceptions should be made for the elderly, the poor and small businessmen, he said.
The poll tax, or head tax, is a flat fee levied by local authorities to pay community costs, but critics call it unfair because it is not based on ability to pay and the rich pay the same amount as the poor.
Pervasive public anger at the plan, shown through nationwide protests and a central London riot, has been the key factor in bringing Thatcher's popularity to an all-time low. Doubts also have been raised over whether she can lead her party through nationwide elections that must be held by mid-1992.
Heseltine, a former defense secretary who resigned after a 1986 dispute with Thatcher over an arms purchase, said there is a belief in key Conservative strongholds that the poll tax is 'either too high, unfair, or both, and it has created a lingering sense of injustice.'
'There is no realistic prospect that the government will do other than fight the next election with the community charge in place,' he said. 'But most people in my party now agree that it needs considerable modifications.'
The British Broadcasting Corp., citing a briefing by Downing Street, said Thatcher 'does not see much that is new' in Heseltine's proposals.
Heseltine has been cast putatively as Thatcher's main rival and senior Conservative Party members after a Cabinet meeting charged he was really making a thinly disguised leadership challenge.
'What I would say to Michael is, 'Michael, we know you are a candidate for the leadership, message received and understood, now over and out, time for a lie down,'' said Conservative MP Neil Hamilton.
The Conservative Party plans to adjust the tax but Local Government Minister Michael Portillo, who is conducting the review, said radical restructuring is not on the agenda.
'The basic form of the community charge is right and is widely accepted,' he said. 'The widespread view of the Conservative Party is that they don't want a wide-ranging review again.'
Heseltine, speaking on the BBC, tried to downplay the furor his article had inspired but sidestepped questions about a leadership bid.
He said it is crucial to review the tax after last week's local elections, in which the Conservatives lost many seats, but scored some victories in London districts with low taxes.
'It has got a new relevance ... because we saw what happened in the London election results, when the local people had the clear choice about the sort of people they wanted to run their authority, and the sort of charge they wanted to pay,' Heseltine said.
