When Kemi Badenoch, Leader of the Conservative Party, stepped up to the podium on October 8, 2025, the hall at the Conservative Party ConferenceInternational Convention Centre in Birmingham she declared a bold new promise: the abolition of stamp duty on primary homes in England. The crowd exploded into a standing ovation, the kind you only see when a party’s flagship policy vows to rewrite the rules of home‑ownership.
Why the Move Matters Now
The UK government currently collects roughly £12 billion a year from stamp duty land tax, according to the Office for Budget Responsibility. That money funds everything from local council services to NHS capital projects. Badenoch argued the tax is an "unconservative" barrier that keeps millions from moving up the property ladder. "A society where no one can afford to buy or move is a society where social mobility is dead," she said.
Historical Context: From Thatcher to Truss
Stamp duty has been on the political chopping block before. In 2003 the Labour government introduced a sliding‑scale rate to ease the burden on first‑time buyers. The Conservatives, under David Cameron, slashed rates in 2010 and again in 2022, capping the tax at 5% for homes up to £250,000. Yet each tweak left a residual levy that still ate into a buyer’s budget.
Analyst Thomas Pope of the Institute for Government noted, "Abolishing stamp duty would be the most radical shift since the 2010 cut, but it also raises a huge fiscal hole that has to be filled somewhere."
Details of Badenoch’s Proposal
- Target: primary residence purchase in England only – Scotland and Wales are explicitly excluded.
- Implementation: the policy would take effect in the first fiscal year after a Conservative majority government is formed.
- Revenue Replacement: no concrete plan disclosed; Badenoch hinted at "smart spending" and cutting waste elsewhere.
During the speech she added, "We’ve looked at the thresholds, the rates – tweaking isn’t enough. The only solution is to remove the tax altogether." The "big T and C" – the must‑have of a Conservative win – was underscored by BBC analyst Henry Zeffman, who reminded viewers that only a governing majority can rewrite tax law.
Reactions Across the Political Spectrum
Labour’s shadow chancellor, Rachel Reeves, called the pledge "politically reckless" and warned of "potential cuts to vital public services" if the revenue gap isn’t addressed. The property‑developer lobby, represented by the Home Builders Federation, cheered the move, saying it could add up to 130,000 extra transactions a year.
Meanwhile, economists at the National Institute of Economic and Social Research warned that a sudden revenue loss could force local councils to raise council tax or cut services, disproportionately hitting low‑income households – the very groups the policy aims to help.
Potential Impact on Buyers and the Market
If the policy materialises, the average first‑time buyer could save about £4,000 on a £300,000 home, according to a simulation by the Royal Institution of Chartered Surveyors. That cash could be the difference between buying and staying on the rental market.
On the flip side, the removal of a transaction tax might inflate house prices, as sellers adjust for the lost revenue. A 2024 study by the Bank of England suggested that removing stamp duty could lift median house prices by 2‑3% in the short term.
What Comes Next?
Badenoch’s pledge is a political lever. The Conservatives would need to win the next general election, craft a Finance Bill, and survive scrutiny from the Treasury Select Committee. Critics say the lack of a revenue‑replacement blueprint could become a stumbling block in parliamentary debates.
Should the policy pass, Treasury officials have said they would explore "efficiency savings" and perhaps a modest increase in other taxes, such as a higher rate of corporation tax, to plug the gap.
Broader Implications for the UK Tax System
Beyond housing, the move signals a willingness to challenge entrenched fiscal structures. If successful, it could embolden future proposals to scrap other legacy taxes, like the inheritance tax or capital gains tax reliefs for certain assets. Observers note the echo of Liz Truss’s 2022 “fiscal shock” – a rapid, market‑focused set of tax cuts that rattled global markets.
Key Takeaways
- Removal of stamp duty is a headline‑grabbing promise aimed at boosting homeownership.
- It applies only to England and hinges on a Conservative election win.
- Potential savings for buyers are sizable, but the £12 bn revenue loss is significant.
- Opposition parties and fiscal watchdogs are demanding a clear funding plan.
- The proposal could reshape the UK’s broader tax landscape if enacted.
Frequently Asked Questions
How would abolishing stamp duty affect first‑time homebuyers?
First‑time buyers could save roughly £4,000 on a £300,000 purchase, according to the Royal Institution of Chartered Surveyors. That extra cash could make the difference between securing a mortgage and staying in the rental market, potentially increasing homeownership rates among younger adults.
What revenue would the government lose without stamp duty?
The Treasury estimates stamp duty land tax brings in about £12 billion a year. That money currently funds local council services, NHS infrastructure and other public spending. The government would need to replace this shortfall through either spending cuts or new tax measures.
Will the policy apply to Scotland and Wales?
No. Badenoch explicitly said the abolition would only cover England, leaving the devolved administrations in Scotland and Wales to keep their own stamp‑duty regimes.
What do economists say about the impact on house prices?
A Bank of England study from 2024 suggests that removing stamp duty could lift median house prices by 2‑3% in the short term, as sellers adjust to the loss of transaction tax revenue. The net effect on affordability would therefore depend on whether buyer savings outweigh higher prices.
What are the political hurdles to implementing the plan?
The policy can only be enacted if the Conservatives win a majority in the next general election. It would then need to pass through a Finance Bill, survive scrutiny by the Treasury Select Committee, and be accompanied by a credible plan to offset the £12 billion revenue loss.