The flagship poll tax policy had been designed to iron out inconsistencies in local finance but it became a hugely unpopular millstone around Margaret Thatcher's party's neck.
A flat charge for adults, paid by rich and poor alike, it replaced the progressive taxation of the rates system which required homeowners to pay more depending on the value of their house.
It was piloted in Scotland in 1989 but faced widespread opposition after an organised campaign of non-payment sprung up, championed by the anti-poll tax unions, the first of which was formed in Glasgow's Maryhill.
Although Labour refused to back the calls for non-payment, with Neil Kinnock saying "lawmakers should not be lawbreakers", it was estimated council finances were facing a shortfall of 30% because of the campaign.
By the end of the first year a total of 700,000 summary warrants for non-payment of poll tax were issued, and more than 1.5 million people refused to pay.
But Mrs Thatcher remained obstinate and refused to change course as the tax headed for England and the Conservative Party's heartlands.
There the opposition grew violent, with an anti-poll tax rally in Trafalgar Square in 1990 attended by 200,000 people turning into one of the biggest riots in British history.
Protesters clashed with police in what became running battles that lasted into the early hours of the morning.
With TV scenes showing the civil disobedience and a non-payment campaign growing in strength south of the Border, many Tory MPs began to fear for their seats.
One reporter who worked in Westminster at the time remembered MPs telling him the reaction to the poll tax was "disastrous" in their constituencies. The braver wondered aloud if the time had come to "do something about" their leader, realising that as long as she remained, the poll tax would stay.
Eventually, discontent within Tory ranks over the tax and other issues coalesced around Michael Heseltine, who challenged her for the leadership.
Falling two votes short of preventing the contest going to a second round, Mrs Thatcher declared she would fight on, but was persuaded by party insiders that she would not win. She chose instead to stand down.
Tommy Sheridan, who made his name fighting against the poll tax, believes Mrs Thatcher became "intoxicated" with power.
The former Socialist MSP, who was a leading activist in the campaign against the poll tax and was jailed for his protests, said: "Thatcher became intoxicated with power and arrogance. She thought she could take on and defeat anyone.
"But with the poll tax she was totally out of touch, and the people of Scotland sunk her flagship and fortunately forced her to go down with it.
"There will be no tears shed for her in working-class communities. There will be tears shed by Tory flunkies and the blue-rinse brigade, but I'm sure miners and health workers will find her condition satisfactory."
Anti-poverty campaigner Bob Holman said she was much more liberal than the present David Cameron Government.
The former professor in social work at Glasgow University, added: "In Scotland, we owe a lot to her because she introduced the poll tax which led to the wiping away of almost every Conservative seat in Scotland. In an odd kind of way, Scotland could be grateful to her.
"The most regrettable thing was the selling off of council housing, which she was wrong about.
"She saw it as a failure and she got rid of it. It was an absolute catastrophe."
Mr Holman said Mrs Thatcher had an ability to speak to people though, which the Labour Party of the time could not, and as a result a lot of working class people did vote for her.
He added that although she did not privatise everything, she "set the pattern".
He said: "The Coalition Government are now more right wing than she was and deliberately increasing inequality. With her it was more a by- product, and her background was part of her appeal.
"You couldn't say of her – as you can of Osborne and Cameron – that she didn't know what life was like for ordinary people."
Mr Holman continued: "In Scotland, being from England was almost like being associated with her. When I moved to Easterhouse she was still Prime Minister and I had to overcome that."
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