Badenoch pledges inheritance tax abolition for family homes amid criticism of Tory priorities
Conservative leader Kemi Badenoch said a future Tory government would abolish inheritance tax on family homes, arguing that people who work hard and save should be rewarded. The plan has drawn criticism that the party is prioritising affluent voters, while raising concerns about lost public revenue and incentives for older homeowners to stay in larger homes.
Badenoch said couples could leave an additional £1m tax-free to their families and that the number of estates paying inheritance tax, currently under 5%, would fall by more than half. The party says it has identified £70bn in savings to fund the policy. At its Birmingham conference, Badenoch also promised to scrap stamp duty on home purchases and the mansion tax, while presenting economic growth as the party’s central priority.
- Badenoch proposes ending inheritance tax on family homes.
- Couples could pass on an extra £1m tax-free.
- Critics say the plan favours the wealthy and risks public service funding.
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Inheritance tax is charged on money and property left to family members when someone dies. Currently, it applies at 40% on amounts above £325,000 per person, though in practice it affects only wealthier families, with fewer than 5% of estates paying any tax.
Kemi Badenoch, leader of the Conservative Party, is announcing policies for a potential future government after Labour's 2024 general election victory. Inheritance tax has become a significant point of disagreement between the major political parties, reflecting different views on how much wealth should pass tax-free between generations.
Inheritance tax sits at the centre of a debate about fairness and public funding in society. Supporters of lower taxes on inheritance argue people should be free to pass wealth to their children, whilst critics worry that allowing large tax-free transfers increases inequality and reduces government revenue for public services.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Those supporting the policy argue that people who have worked hard and accumulated wealth deserve the right to pass it to their families without the state taking a share. They contend that inheritance tax represents double taxation—penalising thrift and lifelong savings—and that removing it would encourage wealth creation and economic growth. From this perspective, it is fundamentally unfair that decades of discipline and sacrifice should be diminished by the state at the moment of death, and that the policy reflects appropriate respect for property rights and family provision.
The case against
Those opposing the policy contend that it primarily benefits the wealthiest whilst doing little for ordinary families, since fewer than 5% of estates currently pay the tax. They argue that the lost revenue—claimed to be offset by £70bn in savings—would either require tax rises elsewhere that harm working people or reduce funding for public services. Critics also note that the policy creates perverse economic incentives, discouraging older homeowners from downsizing and thereby restricting the housing supply needed for younger buyers, whilst reinforcing inter-generational inequality by entrenching wealth advantages.
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Originally published by The Guardian as “Tories accused of prioritising rich voters as Badenoch lays out inheritance tax cut plan”.