Kemi Badenoch announces plans to end inheritance tax on family homes

Kemi Badenoch has vowed to axe inheritance tax when family homes are passed down to children and grandchildren, as she made her pitch to the country at the Conservative Party Conference.

The Tory leader said the next election will be a “battle for the soul of the nation” as she promised the party would focus on letting people “keep more of what they earn” if it returned to power.

In a speech to Conservative members in Birmingham earlier today, she pledged to abolish death duties on all “family homes” and allow couples to leave behind an additional £1m tax-free.

This comes on the back of previous announcements to scrap stamp duty and reverse Labour’s so-called mansion tax.

Tory officials defended making this a key policy over reducing income tax, saying that death levies are “fundamentally unfair”.

There had been rumours that Mrs Badenoch may actually commit to abolishing inheritance tax in the run up to the party conference, however she said this would not be affordable.

“We are not abolishing inheritance tax at this conference. I know you’re disappointed,” she said.

“We could do it. We could do it, but not if we want to keep our country safe with a ‘Britannia Shield’.

“Not if we also want to keep people safe with 50,000 new prison places.

“Not if we want to cut the deficit, threatening to bankrupt our country and burdening our children.”

Instead Mrs Badenoch announced that families would pay no inheritance tax when handing down their home to their children.

“The Conservatives are and always have been the party of home ownership,” she said.

“We understand why putting roots down and having a stake in society matters – our homes are where we watch our children take their first steps.

“They are where we gather every Christmas to put up the same decorations – passing on your home to your family is one of the most human instincts of all.

“So, conference, the next Conservative government will legislate so nobody will ever pay inheritance tax on their family home.”

She also announced that couples would get an allowance of £1m before being levied.

The move would mean the number of families paying inheritance tax will fall by more than half, Mrs Badenoch said as she accused Labour of being “addicted to welfare” and treating income and savings as “theirs to take and hand out.”

“The Labour Party think it is selfish to pass on what you have earned to your children. We don’t,” she said.

As she seeks to reverse the Tories’ fortunes following its 2024 electoral rout, she insisted she was “not someone who gets written off” and “neither is the Conservative Party”.

The Tory leader immediately came under fire from the Trade Unions Congress, with general secretary Paul Nowak saying: “This is a tax paid only by the very richest estates – 95 per cent pay no inheritance tax at all. Cutting it would do nothing for ordinary people.

“This is the same old Tory playbook: cutting taxes for their rich mates and leaving working people to pick up the bill. They are a party for inherited wealth, not workers.”