Kemi Badenoch vowed to abolish stamp duty as she took the fight to Labour and Reform on the economy.
The Tory leader electrified her party’s annual conference in Manchester by announcing plans on Wednesday for an audacious £9 billion tax cut funded by a crackdown on welfare and waste.
She told cheering delegates that abolition of the hated tax would restore the Tories’ reputation as the party of home ownership, and help trigger an economic and social renaissance.
Mrs Badenoch said the Conservatives had always believed that ‘owning your own home gives you a real stake in society, roots in your community’. But she said a ‘a big barrier keeps getting in the way’.
Vowing to abolish stamp duty on all primary residences, she said: ‘That is how we will help achieve the dream of home ownership for millions.
‘This change will bring wider benefits to our economy, too, because every time a home is sold it triggers a chain reaction of activity.’
Mrs Badenoch said the move would mean that first-time buyers, growing families and pensioners looking to downsize would no longer be ‘punished with a tax that is a barrier to doing the right thing for them, for their family, and for society’.
In a bullish speech that belied her party’s stuttering fortunes, Mrs Badenoch vowed to reverse the country’s ‘stagnation’ under Labour, declaring that she would ‘save Britain from that fate’.
Kemi Badenoch vowed to abolish stamp duty as she took the fight to Labour and Reform on the economy on Wednesday
The Tory leader electrified her party’s annual conference in Manchester by announcing plans for an audacious £9 billion tax cut funded by a crackdown on welfare and waste
Mrs Badenoch, flanked by her husband Hamish, said the move would mean first-time buyers, growing families and pensioners looking to downsize would no longer be ‘punished’ by the tax
Her performance appeared to have silenced her internal critics and calmed the fevered speculation around her own leadership. One shadow cabinet plotter said the ‘impressive’ speech had ‘bought her some time – maybe more’.
A senior loyalist said leadership rivals like Robert Jenrick had been put ‘back in their box’ by the tax masterstroke.
Tory strategists now face an anxious wait to see if the ‘big bazooka’ policy succeeds in capturing the public imagination – and shifting the party’s dismal poll ratings.
In a 45-minute address, Mrs Badenoch:
:: Pledged to break Britain’s ‘addiction’ to immigration and deport 150,000 people a year who have no right to be here.
:: Said the Conservatives would ‘bring back the high street’ with a £4 billion plan to abolish business rates for pubs and shops.
:: Vowed to legislate to ban doctors from going on strike.
:: Described a surge in sickness benefit claims under Labour as a ‘national tragedy’ while promising to strip ‘freeloaders’ of welfare payments.
A senior loyalist said leadership rivals like Robert Jenrick had been put ‘back in their box’ by Mrs Badenoch’s tax masterstroke
Mrs Badenoch and her husband waved for the cameras after her successful turn on stage
Shadow cabinet ministers gave a rapturous reception to Mrs Badenoch’s conference speech
:: Pledged to scrap ‘non-crime hate incidents’ and ‘free the police to protect the public not chase political correctness’.
:: Warned the record tax burden imposed by Labour was ‘making Britain poorer’ and forcing businesses to ‘give up’.
:: Committed to scrapping green levies on energy bills, saving the average household £165 a year.
The decision to axe stamp duty was a tightly held secret, with even members of the shadow cabinet kept in the dark.
It came at the end of a week in which the Tories fleshed out a previously threadbare policy platform with a string of announcements covering everything from immigration and the economy to schools and the police.
Mrs Badenoch said that despite last year’s landslide election defeat and growing alarm over the party’s slump in the polls, the Conservatives were still ‘fizzing with ideas’.
The abolition of stamp duty will save homebuyers thousands of pounds at one of the most financially stretching times in their lives. The tax hits around 600,000 property transactions a year.
Tory sources said the change is likely to be brought in immediately in the event of a Conservative victory to avoid gumming up the housing market.
Mrs Badenoch vowed to reverse the country’s ‘stagnation’ under Keir Starmer’s Labour, declaring that she would ‘save Britain from that fate’
Her surprise move on stamp duty was welcomed by economists and the property expert Kirstie Allsopp, who said it was ‘brilliant and bold’
Economists have long blamed the tax for distorting the housing market and impacting the wider economy. The Institute for Fiscal Studies has described it as ‘the most economically damaging tax in the UK’.
The Tory plans will apply across England and Northern Ireland. But they will only apply to primary residences, meaning that those buying a second home will still face the charge.
A Tory source said scrapping the tax was ‘not just a moral good, but an economic good too’.
The source added: ‘It would remove artificial restrictions on the property market – restrictions that stop working people taking jobs or relocating where they need to for employment, or that stop older people from downsizing and freeing up larger properties for families.
Mrs Badenoch said scrapping stamp duty was the ‘key to unlock a fairer and more aspirational society.’
Property expert Kirstie Allsopp praised Mrs Badenoch for ‘correcting a mistake’ made by successive governments who looked to the property market as a source of easy revenue without considering the negative impact on the economy.
The Location, Location, Location star described the initiative as ‘brilliant and bold’, adding: ‘If Rachel Reeves wants to boost the economy she should copy this straightaway.’
Tom Clougherty, of the Institute of Economic Affairs think tank, said abolishing stamp duty was ‘the single best reform any government could make to Britain’s tax system’.
Mrs Badenoch acknowledged continuing public anger with the Tories – and said it had given Reform, led by Nigel Farge, a platform for policies that would ‘blow up the public finances’
He added: ‘As things stand, this outdated and uneconomic levy is wreaking havoc on our already troubled housing market – by deterring sales and depressing house-building.’
The Adam Smith Institute suggested the move could lead to 467,000 extra house sales per year, providing a massive stimulus to the economy.
Mrs Badenoch said the measure would be paid for from the proceeds of £47 billion in cuts unveiled by shadow chancellor Sir Mel Stride earlier this week.
The package includes £23 billion of welfare savings that will ban people with low level mental health issues like anxiety from claiming sickness benefits and tighten up eligibility for the controversial Motability car scheme.
Further savings come from slashing civil service numbers by 130,000, cutting £7 billion from foreign aid and scrapping Net Zero subsidies.
The Tory leader announced a new ‘golden rule’ which would require at least half of all savings to go towards reducing the huge budget deficit, with the rest spent on tax cuts and measures to boost the economy.
She confirmed tax cuts totalling £21 billion, including reversing Rachel Reeves’s tax hike on family farms and businesses, ending Labour’s ‘shameful’ VAT raid on private schools and introducing a £5,000 ‘first job bonus’ for youngsters entering the workforce for the first time.
Mrs Badenoch said a future Tory government would ‘bring down the taxes stifling our economy’ and reverse Labour’s ‘borrowing and tax doom loop’.
Tory strategists believe the party’s best hope for recovery lies in trying to restore its battered economic credentials.
Mrs Badenoch said the Conservative approach ‘starts with fiscal responsibility’, adding: ‘We have to get the deficit down.’
‘Over the next decade, Rachel Reeves is going to double the deficit with her borrowing and tax doom loop,’ she said. ‘It’s not sustainable and it’s not fair. It is stealing from our children and grandchildren. And Conservatives will put a stop to it.’
She mocked Labour’s election slogan, saying Keir Starmer had delivered ‘change for the worse’.
But she acknowledged continuing public anger with the Tories – and said it had given Reform a platform for policies that would ‘blow up the public finances’.
‘Because (voters) are still angry with us, parties that in normal times would never be seen as a serious option for government are gaining ground, making promises they will never be able to keep,’ she said.
