A prominent minister has criticized Kemi Badenoch’s proposal to eliminate stamp duty as a desperate move reminiscent of Liz Truss, according to reports.
Pat McFadden, the Secretary of State for Pensions, accused the Conservative Party of introducing tax changes without adequate funding and failing to learn from past mistakes, particularly Truss’s unsuccessful mini-budget.
In an effort to inject energy into a lackluster party conference, the Conservative leader promised to scrap Stamp Duty, labeling it a burdensome tax that hampers the housing market.
McFadden expressed doubts, stating, “We’ve seen this scenario before with the Tories announcing tax changes without sustainable funding. This occurred three years ago and was part of their manifesto.”
He added, “It appears desperate coming from a party that couldn’t finance our previous round of tax cuts. By making another round of promises in an attempt to gain immediate gratification, they announced the stamp duty policy, but it wasn’t the only unfunded spending commitment unveiled at the conference. They must learn from the repercussions of their actions in 2022, as the public is still bearing the brunt of it.”
The senior minister referenced the disastrous mini-budget in 2022 that inflicted significant damage on the economy due to billions of pounds in unfunded tax cuts.
Badenoch revealed the proposal at the Tory party conference, later clarifying that the abolishment would only apply to primary residences, not second homes, properties purchased by businesses, or overseas buyers.
The main beneficiaries of this move would be individuals purchasing high-value properties, as Stamp Duty is waived for homes valued up to £125,000, with the exemption threshold increasing for more expensive properties.
According to estimates by the Tories, the initiative is projected to cost approximately £9 billion annually, with funding expected from £47 billion in spending cuts across welfare, foreign aid, and civil service size. However, economists caution that the proposed cuts lack clarity and are challenging to evaluate.
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