Conservative Party leader Kemi Badenoch has proposed scrapping inheritance tax (IHT) on family homes and raising the tax-free allowance to £1 million, framing the proposals as a reward for hard work and saving. Badenoch stated her long-term ambition is to abolish IHT entirely, but cited current spending commitments as preventing immediate action. The proposals, unveiled at the Conservative Party conference in Birmingham, come as the party trails Labour and Reform UK in polls and follows a significant loss in the 2024 general election. Badenoch explicitly rejected any electoral pact with Reform UK, describing many of its voters as former Conservatives she hopes to win back.
The proposed changes would reduce the number of families paying IHT, currently less than 5%, by more than half, funded by anticipated savings of £70 billion. Badenoch positioned the Conservatives as a “no-nonsense party” in contrast to what she characterized as the “circus” of Reform UK and criticized Labour Prime Minister Andy Burnham’s policies as outdated. The proposals have drawn criticism from opposition parties, who argue they prioritize the wealthy over struggling families. Tax Justice UK called the plan a “reckless policy” that would deprive public services of funds. Reform UK suggested the changes would benefit only a small percentage of homeowners, primarily in London.
Left-leaning outlets emphasized the benefit to wealthier individuals and criticized the policy as prioritizing tax cuts for the rich while neglecting support for ordinary families. Right-leaning coverage highlighted the proposals as a reward for homeownership and a commitment to reducing the tax burden. Badenoch also drew a contrast between the Conservative party and Reform UK, stating she did not want to unite with a party she characterized as lacking character, conduct, and standards. She also rejected what she described as Burnham’s attempts to “wind back the clock” to the 1970s.
Our reading is that Badenoch is attempting a strategic repositioning of the Conservative Party, focusing on core tenets of wealth creation and homeownership to appeal to disaffected voters. The explicit rejection of a pact with Reform UK and the framing of Labour as outdated suggest a desire to define the Conservatives as a distinct, stable alternative. The emphasis on a “no-nonsense” approach appears to be a direct response to perceptions of political instability and a bid to project strong leadership.
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