The reason for the changes introduced by FA93 was to raise
revenue for the Exchequer. A UK resident taxpayer who was liable at
the higher rate of 40% suffered an additional liability of 20% (40%
- 20%) rather than 15% (40% - 25%) on the dividend income.
Furthermore, a body that was exempt from tax (such as a pension
fund) received payment of any tax credit at 20% rather than 25%.
The intermediate ACT rate of 9/31 for distributions made in 1993-94 was introduced because an immediate reduction to 1/4 would have had a significant Exchequer cost.