Tory leader's inheritance tax pledge meets the two-bed in Zone 3 where three adults already live, and nobody is brave enough to mention the spare room
LONDON - Kemi Badenoch has pledged to scrap inheritance tax on the family home, and to slash levies generally, while accusing Andy Burnham of spending money we don't have. What's the deal with a tax you only meet when you're dead and a politician you only meet when you're alive. One of them is inevitable. The other is on a podium.
What the Inheritance Tax Pledge on the Family Home Actually Covers
A quick refresher for anyone who has been avoiding the subject on purpose. Inheritance tax is currently charged at 40 per cent on whatever an estate is worth above a £325,000 threshold, and there is an extra allowance when the family home passes to children or grandchildren, which GOV.UK explains in its inheritance tax guidance and, in more detail, under the residence nil-rate band. So the house is already half excused, the way a parking fine is half excused if you pay inside fourteen days. Badenoch's pledge finishes the job. What finishing the job costs is the bit Burnham's side keeps bringing up, at volume, with graphs.
Nor is this a new idea. George Osborne promised to scrap the tax on the family home back in 2007, and the promise was credited at the time with frightening Gordon Brown out of calling a snap election, a point the Times Radio politics podcast was recently revisiting. As political products go, the pledge has an excellent record. It's the delivery that has always been shy.
The Family Home in the Leaflet Versus the Family Home in Zone 3
In the leaflet the family home is a semi, a hedge, a labrador, nobody arguing about the will. In the country it is a two-bed in Zone 3 that three adults already live in, because leaving costs more than staying, and staying now requires a pledge. Does it still count if the family never moved out. The pledge doesn't say. Pledges don't do floor plans.
The Office for National Statistics keeps a count of grown adults living in their parents' homes, and it is not a small number. You could confirm it yourself by walking into any kitchen at twenty to eight on a weekday, where a thirty-year-old in a lanyard is eating cereal out of the good bowl and pretending the fridge belongs to him.
Inheritance tax is a tax on the gap between what your parents paid and what a stranger will pay, collected when nobody is in the mood. Badenoch's answer is to stop collecting it on the house. Burnham's answer, according to Badenoch, is to spend the money anyway. Neither repairs the boiler. The boiler is not ideological. The boiler is making a noise.
Who Is Spending What, and Who Promises to Stop
The Conservatives reshuffled their economic team in August, and the new shadow chancellor, Andrew Griffith, has been telling anyone who'll listen for years which tax he would bin first. He has lately been holding up Sweden, which has dropped stamp duty, its wealth tax and inheritance tax, as the example to follow, as The Spectator Australia noted last month. Reform, never a party to leave a tax cut unclaimed, called the whole idea a desperate play and reminded voters how much the Tories collected in death taxes while they were in office.
So everyone is against inheritance tax and everyone else is against the person who's against it. The only thing all sides agree on is that the dead are overtaxed. Meanwhile the rules are heading the other way. From April 2027, unused pension pots come into scope too. The pension, a quiet guest for decades, is now on the list. It will be asked what it intends to do about the sofa.
Accusing the other lot of spending money we don't have is the national sport. We have played it since decimalisation. The score is level. The money remains unhad. A voter between a school run and a direct debit said she would like the tax scrapped, the direct debit scrapped, and, if there's time, the concept of a spare room. She does not have a spare room. She has a son who is twenty-nine and a pledge that is sixty-one. The pledge cannot sleep on the sofa. The son can, and does.
Housing Market Reality: Nobody Is Moving Out of the Family Home
The Treasury has a face for this. The face says we have modelled it. The model says hello. Everybody is captured. That's the housing market. You don't live in it so much as you report to it. The home, asked for comment, said it was built in 1934, has paid for itself several times, and would like to be left out of the argument. The argument said the home is the argument. The children said they're making tea. Nobody is moving. The pledge has a car, a deadline, and a labrador in the photograph that does not live at the address. https://prat.uk/?p=51267
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