Badenoch signals Conservatives may seek inheritance tax cuts
Kemi Badenoch has signalled that the Conservatives may seek to cut inheritance tax, calling it morally right to let people pass on wealth they have earned. Her comments came as the party’s conference opened in Birmingham, where shadow ministers are announcing policies as the Conservatives try to demonstrate they are ready for government.
The 40 per cent tax generally applies to estates above £325,000, though allowances can raise the effective threshold to £1 million for many married couples. Badenoch said tax cuts would need a credible funding plan. Other proposals include extending 30 hours of free childcare to working parents earning above the current £100,000 eligibility limit, at an estimated annual cost of £700 million, and tightening some non-UK nationals’ access to student loans, which the party says could save £900 million a year.
- Badenoch hints at cutting inheritance tax.
- She says tax cuts must be funded responsibly.
- Tory conference features childcare and student loan proposals.
New here? Start with this
Inheritance tax is a tax paid on estates and property left to others when someone dies. It is currently charged at 40 per cent on estates valued above £325,000, though various reliefs and allowances mean many families are not affected by it. It is seen as a significant tax that affects how much wealth people can pass on to their relatives.
Kemi Badenoch is a leading Conservative politician and a prominent member of the party's shadow cabinet, the group of senior opposition figures who would hold key government positions if the Conservatives win power. The Conservatives are the main opposition party and are currently outlining their plans for government at their annual party conference. Policy announcements at the conference are intended to show the public what the party would prioritise if elected.
Inheritance tax has been a longstanding point of political debate in the UK, with different views on whether current rates are appropriate. Any significant changes to the tax would affect both how families manage their finances and government revenues. The Conservatives' focus on this issue reflects their wider attempt to present their priorities as an alternative to the current government.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
The strongest case for cutting inheritance tax rests on the principle that individuals should retain rights over property they have legitimately earned and wish to pass to their families. Proponents argue that inheritance tax represents double taxation, as underlying wealth was already taxed when earned, and that steep taxes force families to sell family businesses or homes to pay tax bills, undermining small business continuity and property ownership. They contend that allowing greater wealth transfer incentivises saving and investment whilst respecting individuals' fundamental right to dispose of their property as they wish.
The case against
Those supporting higher inheritance taxes argue that wealth passed to heirs is fundamentally different from earned income—beneficiaries have done nothing to earn it—and that inheritance tax serves as an important mechanism for addressing wealth concentration and promoting social mobility across generations. They contend that inherited wealth disproportionately benefits those already privileged, thereby entrenching inequality, and that the tax provides crucial revenue for public services including the NHS, education, and infrastructure that benefit society broadly. From this perspective, inheritance tax represents a fair contribution from the most affluent to the common good.
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Originally published by Daily Mail as “Kemi Badenoch drops another big hint at pledge to scrap inheritance tax as Tory conference kicks off”.