Story summary
Conservative leader Kemi Badenoch pledged to scrap inheritance tax (IHT) on family homes and increase the amount couples can leave tax-free to £1 million during her keynote speech at the party's conference in Birmingham. This change would reduce the number of families paying death duties by half, according to Badenoch. She also expressed an ambition to abolish IHT entirely "as soon as we can afford it," but acknowledged current spending commitments on defense, prisons, and the economy prevent such a move immediately.
Badenoch portrayed the Tories as the "no-nonsense party" compared to Reform UK, which she described as a "circus." She emphasized that her party would fight against Labour’s plans for higher taxes and increased public spending, framing the upcoming election as a "battle for the soul of this nation."
Critics argue these proposals prioritize support for wealthier individuals rather than broader economic issues. Liberal Democrat leader Sir Ed Davey criticized Badenoch's speech, saying she was lecturing on fiscal responsibility while making unfunded promises amounting to tens of billions. The planned changes would take effect before a proposed mansion tax on properties valued at more than £2 million in England. Overall, the Conservative Party aims to differentiate itself from Labour and Reform UK by advocating for lower taxes and economic growth through reduced state intervention.
Written for “Conservatives Inheritance Tax Plan” on 2026-10-07,
grounded in this article and the 15 other(s) covering the same event.
- Published
Conservative Party leader Kemi Badenoch has pledged to scrap inheritance tax (IHT) on family homes and increase the amount couples can leave tax-free to £1m, in her keynote speech at the party's conference in Birmingham.
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couples → publish → Birmingham
Badenoch added her ambition would be for a Conservative government to abolish IHT "as soon as we can afford it", but said she could not currently propose this due to spending commitments on defence, prisons and the economy.
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she → add → defence
Badenoch also used her speech to try to make clear how the Tories differed to Labour and Reform UK.
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differed → use → Labour
She pitched them as the "no-nonsense party" compared to the Reform UK "circus" and accused Prime Minister Andy Burnham of wanting to "live in the past".
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She → pitch → past
Rival parties hit back and said the proposals for IHT, which is levied on the value of someone's estate when they die, would prioritise support for wealthier people in the country.
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they → hit → country
Badenoch arrived in Birmingham's Symphony Hall with a message to Conservative Party members that they face a "battle for the soul of the this nation".
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they → arrive → nation
She argued her party is "renewed" and "coming back" as she continued efforts to convince voters that it has changed following an historic defeat at the 2024 general election.
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it → argue → election
In a nod to those who have defected to Nigel Farage's party, Badenoch said: "The Conservatives have had an export boom of drama queens going to Reform.
"
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queens → defect → Reform
With the party trailing Labour and Reform in the polls, Badenoch acknowledged that people are "looking through the shop window", they "like what they see" but "not enough of them are buying yet, we need to fix that".
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we → trail → that
Her inspiration for how to revive a long-standing brand was Marks and Spencer (M&S), saying they have "adapted their style for today's market and people are flooding back".
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people → revive → market
Badenoch added: "Just like M&S, we must learn from our mistakes, win back trust and make people feel good about our party again."
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people → add → party
One of the biggest responses in the room from members came as Badenoch made clear she did not want to do an election deal with Reform.
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want → come → Reform
She described many Reform voters as "our people", adding: "We let them down and we want them to come back home."
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them → describe → them
Following a section of the speech mocking some of Reform's senior figures, Badenoch said: "To those who say 'unite the right', we are not uniting with that.
"
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we → follow → that
People deserve better than that and we are going to give them better than that.
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we → deserve → that
Character, conduct, and standards matter."
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Character → matter → ?
She also said she did not want to live in a country run by people who "debate whether my mixed-race children are English".
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children → say → people
In one of many jibes aimed at Burnham, Badenoch labelled him a "Paddington Bear prime minister" who was "hoping that the problems will just go away".
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problems → aim → him
In the days ahead of Wednesday's speech, there was widespread speculation that Badenoch would announce changes to IHT.
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Badenoch → be → IHT
As the Opposition leader neared the end of her 66-minute speech, she said IHT was "supposed to be a tax on the super wealthy" but it is "now a tax on ordinary middle-class families in every corner of our country".
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it → near → country
She said: "The next Conservative government will legislate so nobody will ever pay inheritance tax on their family home.
"
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nobody → say → home
On top of that, couples would be able to leave an additional £1m tax-free and these changes mean every inheritance tax bill will be cut and the number of families paying inheritance tax will fall by more than half."
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number → leave → half
The Conservatives have estimated the policy would cost around £6bn a year and believe they have identified £71bn of savings that can be made to government spending, including welfare cuts.
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that → estimate → cuts
Under the current rules, estates worth more than £325,000, or £500,000 if a home is left to children or grandchildren, can face a 40% tax rate on assets above the threshold.
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home → leave → threshold
Married or civil partners can also transfer assets between each other.
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partners → transfer → other
In 2023-24, 4.72% of UK deaths resulted in an IHT charge and raised around £7bn for the government.
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% → result → government
Badenoch also said her "ambition is to abolish inheritance tax altogether, as soon as we can afford it".
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we → say → it
Labour Party chairwoman Bridget Phillipson said: "The Tories haven't changed.
"
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Tories → say → ?
Kemi Badenoch has shown that the Tories' choice is to do nothing to help ordinary families struggling with the cost of social care, prioritising the wealthiest instead."
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choice → show → wealthiest
Reform UK economy spokesman Robert Jenrick said Badenoch had "chickened out of doing anything big" and is "for the 2%".
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Badenoch → say → %
The former Tory MP said: "While the Tory Party is offering handouts to multi-millionaires, Reform will give everyone a £500 tax cut by raising the tax-free personal allowance to £15,000.
"
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Reform → say → 15,000
The Tory Party is looking after its own in Kensington, Reform is looking after the country."
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Reform → look → country
Elsewhere in her speech, Badenoch referred to other policies the party has announced in recent days.
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party → refer → days
These include a £10bn anti-missile defence system, 50,000 new prison places and halving the rate of employer national insurance on earnings for people aged between 21 to 24.
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These → include → 24
They also pledged to scrap the "cliff edge" that means parents in England lose out on childcare support when they earn more than £100,000 a year.
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they → pledge → 100,000
Another policy to be scrapped would be the High Value Council Tax Surcharge (HVCTS), dubbed the "mansion tax".
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policy → scrap → ?
This is due to take effect from 2028 and introduces an extra levy for owners of properties in England valued at more than £2m.
Liberal Democrat leader Sir Ed Davey responded to the speech by saying Badenoch had been "lecturing the country on fiscal responsibility while making tens of billions in unfunded promises".
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Badenoch → take → promises
Green MP Carla Denyer added: "Kemi Badenoch once again defined the Conservative Party as pro-billionaires, pro-inequality and pro-damaging the environment."
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Badenoch → add → environment
The Aporia
