Stamp duty abolition: Tories renew pledge to scrap tax on main homes

Stamp duty abolition on main homes is again Conservative policy, after the party used its annual conference to set out how it says it would cut the cost of moving and of buying a new build. Shadow housing secretary Katie Lam called for stamp duty and the Future Homes Standard to be scrapped, according to trade outlet The Intermediary. It is opposition policy only, and nothing changes for buyers unless the party wins power.

Shadow chancellor Andrew Griffith separately pledged to take up to £50,000 off the price of a new home. The i Paper reported that this is the Conservatives’ own estimate and has not been independently corroborated.

The Conservative stamp duty policy and the new-build plan

Party leader Kemi Badenoch announced at the conference that the Conservatives would scrap stamp duty on primary residences. The i Paper reported that doing so would cost the Treasury around £9bn, but that Badenoch said it would “unlock a fairer and more aspirational society” by making it easier to buy a house. None of the sources reviewed gives a date by which the tax would go.

Griffith said the party’s first Budget back in government would aim to be “a tax-cutting Budget”, but that further cuts would come “only as and when we can, living within our means”. On inheritance tax he said the party “won’t be able to do everything that we want to do on day one”.

The new-build plan rests on regulation. The party would axe the Future Homes Standard, under which builders would have to fit items such as heat pumps in new homes from 2027, according to The i Paper. It would replace Section 106 agreements and the community infrastructure levy with one “simple and transparent” fee, and abolish Natural England and the Environment Agency, passing the work still needed to Defra.

Who would be affected by stamp duty cuts and housing reform

Anyone buying a main home would be affected by the stamp duty change, but Lam focused on older homeowners. She told The i Paper the tax was “a massive disincentive to downsize” for people in homes that had become very valuable, because moving would cost them “tens of thousands of pounds” that went to the Exchequer.

Her argument is that abolition would work through the market. Downsizers would free up family homes, and families moving up would free up starter homes for young buyers, for whom owning a home was, she said, “far too distant a dream”. That is Lam’s claim rather than an independent forecast.

Buyers of new builds and the councils that rely on developer payments would also be affected. Section 106 and the levy currently pay for affordable homes, roads, schools and GP surgeries, and Griffith says the new fee would give local councillors more say over spending. Owners of homes worth £2m or more would also see a change: the party said it would scrap the High Value Council Tax Surcharge, which charges between £2,500 and £7,500 a year from April 2028.

What the numbers show

The sources give several figures that can be set side by side. The Conservatives claim the Future Homes Standard adds more than £30,000 to the cost of building a home and that wildlife rules add almost £6,000. Together that is roughly £36,000, so about £14,000 of the £50,000 headline saving is not itemised in the material published so far.

The Evening Standard reported that party researchers pointed to the Birmingham document. Dividing £30,789 by £2,715 gives about 11.3 years, in line with the council’s own estimate that the technologies pay for themselves within roughly 11 years. On the council’s figures, then, buyers of such homes could recoup the extra upfront cost through lower energy bills over that period. The figures are one local authority’s 2023 assessment and may not apply to all new builds.

Supporters and critics on planning reform and house prices in the UK

Propertymark gave a qualified welcome. Timothy Douglas, its head of policy and campaigns, said: “Scrapping Stamp Duty would also remove a significant barrier to moving home and could help improve mobility across the housing market.” He added that scrapping the Future Homes Standard altogether “needs careful consideration”, and that “planning reform alone will not solve the housing crisis”.

Douglas also said the £50,000 claim would need to be tested against whether the savings reach consumers. Paul Johnson, the former director of the Institute for Fiscal Studies, told Times Radio the Tories’ diagnosis that regulation holds back the economy was “at least partly right”, but that they needed to “put some flesh onto those bones”.

Political opponents were harsher. Labour’s Bridget Phillipson said the Tories “had failed at every turn” to grow the economy in 14 years in power. Liberal Democrat deputy leader Daisy Cooper called their plans a “litany of fantasy-financial pledges”. The Conservatives say the changes would cut costs and make it easier to buy and to build.

What happens next and what buyers should know

Nothing in the policy takes effect until the party is in government and legislates. The Future Homes Standard rules are due to start in 2027, and the council tax surcharge in April 2028, both under current rules. The sources give no election date.

For buyers, stamp duty remains payable under current rules, so costs are calculated on the rules as they stand today. A pledge does not change those rules. If you are looking at a new build, it is worth asking the developer what heating and energy specification is included, because that affects both price and running costs. Any change to property taxes would have to come through a future Budget.

Your questions answered

Will stamp duty be abolished in the UK?

Not under current law. The Conservatives have pledged to abolish it on primary residences, but they would have to win power and legislate. Griffith has warned the party cannot do everything on day one.

How would stamp duty abolition affect house prices?

The sources contain no independent estimate. Lam argues it would encourage downsizing and free up homes, and Propertymark says it could improve mobility. The £50,000 figure relates to new-build costs from regulation, not to stamp duty.

What planning reforms are needed for housing?

The Conservatives propose a single developer fee in place of Section 106 and the levy, plus scrapping Natural England and the Environment Agency. Propertymark says planning reform alone will not solve the housing crisis, while Johnson says the party needs to put more detail on its plans.