Badenoch Pledges to Exempt Family Homes from Inheritance Tax

Kemi Badenoch promised on October 7, 2026, that a Conservative government would abolish inheritance tax on family homes.

She made the pledge in her closing speech to the Conservative party conference in Birmingham. The plan would exempt a home passed to children or grandchildren from inheritance tax if the Conservatives are elected, according to conference reporting The Guardian.

Inheritance tax is charged on the estate left after death. Couples could leave an additional £1m tax-free to their families under the proposal. Badenoch said it would cut the number of families paying the tax by more than half. Fewer than 5% of families pay it at present.

She framed it as a housing guarantee: no stamp duty when buying a home, no mansion tax when living in a home, and no inheritance tax on a home passed to children or grandchildren. Stamp duty is the tax paid when buying property. A separate Conservative statement had previously said a next Conservative government will abolish stamp duty entirely on primary residences.

Badenoch added that her ambition is to abolish inheritance tax altogether as soon as affordable. The pledge is conditional. It is an intent for government, not a change in force.

The current system levies inheritance tax at 40% Reuters. The rate applies to estate value above £325,000, with a higher threshold of £500,000 in certain circumstances BBC. Ahead of the speech, Badenoch had been expected to announce a cut to the 40% rate.

The announcement drew an immediate accusation that the Conservatives were prioritising rich voters. The charge reflects the narrow base of the tax.

On funding, Badenoch said the plan would be paid for from £70bn in savings the party says it has identified. No further breakdown was contained in the verified account of the speech.

Badenoch is Leader of the Opposition and leader of the Conservative Party. The speech follows her Policy Renewal Programme, launched in London in March 2025, and her early 2025 address on rebuilding trust in the party. Those earlier statements frame a conference built around policy definition rather than administration.

The broader context here is targeting and credibility. A housing-only exemption focuses on intergenerational transfer rather than a general rate cut. It narrows the cost compared with full abolition while keeping full abolition as the stated direction. Pairing it with stamp duty abolition extends the offer from death to purchases during life.

In my view, the politics will turn on two tests in the facts. The first is distributional. A tax paid by fewer than 5% invites the criticism already made, that relief flows upward, unless voters accept the home as a distinct moral category. The second is fiscal. A pledge tied to £70bn in savings depends on whether those savings are specified and accepted. Until then, the proposal works as much as positioning as policy.