Following the change of government over the summer, the tax landscape going into party conference season 2026 was remarkably similar to last year. Prime Minister Andy Burnham and Chancellor John Healey face the conundrum of how to raise much-needed tax revenue whilst also sticking to Labour’s 2024 manifesto pledges not to increase VAT, National Insurance Contributions (NICs), or the rates of income tax or corporation tax, whilst also trying to incentivise economic growth.
With Budget 2026 just weeks away, Labour were predictably playing their cards close to their chest on tax policy. However, party conference season provides a unique insight into how each of the main political parties would tackle the challenge of balancing the books and kickstarting growth. Although they are not in a position of power to implement their ideas, opposition party tax policy can influence the direction of travel of government tax policy, both in the long and short term.
The summary below is not intended to be an exhaustive account of all views expressed at conferences but focuses on statements from senior Ministers and officials as the most reliable indicator of future party tax policy.
Hope Again?
In keeping with the Labour conference slogan 'Hope Again', John Healey’s speech to conference in Liverpool sought to strike an upbeat tone, praising Britain’s strengths and resilience, and promising a brighter future under his Chancellorship. However, ultimately his speech was underpinned by a commitment to fiscal discipline, and he was candid about the state of the public finances when he drew a distinction between this Labour Government and the previous one: “The money New Labour had in the nineties is simply not there now”.
The Prime Minister’s speech announced Labour’s longer-term ambition to reform social care in England through the introduction of a new National Care Service. A government press release stated the policy would be fully funded – and not through borrowing – and the Prime Minister ruled out further tax rises to pay for these reforms. Instead, funding will come from reforms to the pensions ‘triple lock’ intended to take effect in the next Parliament, and the new service will be introduced in phases so its scope can grow as savings from triple lock reform increase over time. However, the think tank the Institute for Fiscal Studies (IFS) has still warned that the proposed changes to the triple lock are unlikely to fully fund this policy, raising the prospect that further tax rises would be required to deliver this pledge.
All eyes on the Budget
Capital gains tax (CGT) reform remains a hot topic in advance of this years’ Budget, with reports that the Chancellor was considering increasing CGT rates and possibly equalising them with income tax rates. At a fringe event, the think tank CenTax reiterated its calls for broader reform of CGT, including an allowance for investment, better treatment of losses and removing incentives to leave the UK before selling a business or to hold assets until death. However, press reports post-conference suggest that CGT increases have been ruled out by the Chancellor.
For the third year in a row, trade unions tabled a successful motion calling for the introduction of a wealth tax. However, per prior years, it is not expected that Labour Ministers will act upon the motion. Trade unions also used the conference in Liverpool to call for windfall taxes on banks and energy companies to fund support for household energy bills. Bank and energy taxes were not protected from tax rises in the 2024 Labour manifesto and there has been growing press speculation that banks in particular will be subject to tax rises at the Budget.
Devolution will be a key theme of the Budget. Financial Secretary to the Treasury (FST) James Murray spoke of the central role that fiscal devolution would play in the Government’s plans to drive growth across the country. The Government has confirmed that a devolution roadmap will be published alongside the Budget – potentially setting out further details on proposals for local areas to retain a portion of business rates and income tax revenues in England – as well as a white paper detailing the Government’s wider proposals for devolution and a clear timetable for implementation. Business Secretary Jonathan Reynolds also used a fringe event to reiterate plans to give regional mayors the power to implement an overnight visitor levy and suggested it could provide mayors with a “revenue stream to borrow against.”
Conservatives pitch tax cuts
The Conservative party conference in Birmingham provided the first major outing for Shadow Chancellor Andrew Griffith, who recently replaced Mel Stride. He used his speech to conference to pitch “lower, simpler and fairer taxes” as a key pillar of the Conservatives’ plan to “make our country prosperous again” and outlined an aspiration to “scrap at least one tax every Budget”. However, these ambitions came with a clear caveat that taxes would be cut only when it was affordable to do so.
The centrepiece of the Leader of the Opposition Kemi Badenoch’s speech to conference was a promise to abolish inheritance tax (IHT) on family homes passed on to direct descendants as well as raising the threshold at which IHT becomes payable from £325,000 to £500,000 per person. Interestingly, the think tank Tax Policy Associates (TPA) has suggested that the cost of this policy could be around £2-5 billion higher than the Conservatives’ £6 billion estimate, once behavioural impacts are factored in such as greater ‘parking’ of wealth in housing and owners of larger homes having less incentive to downsize.
Badenoch’s speech promised further giveaways to homeowners by reiterating last year’s conference pledge to scrap Stamp Duty Land Tax (SDLT) on purchases of primary residences in England and Northern Ireland bought by UK residents, and confirming that the Conservatives would reverse the planned council tax surcharge on homes worth more than £2 million (a.k.a. the ‘mansion tax’) if they won the next election.
Alongside a pledge to end a ‘cliff edge’ at which parents earning more than £100,000 miss out on free childcare, Griffith set out his belief that high marginal income tax rates in excess of 50 percent were “unfair” and that his ambition was to eliminate such rates, again only when affordable to do so.
Finally, the Conservatives used this conference to announce their plans to reduce the employers’ NIC rate from 15 percent to 7.5 percent for workers aged 21-24 on earnings up to £50,270, with the dual aim of boosting employment rates amongst younger workers and cutting costs for business. Badenoch announced that this policy would replace the ‘First Job Bonus’ unveiled at the prior year’s conference (where British nationals taking on their first job would have seen the first £5,000 they were due to pay in NIC redirected towards a personal savings fund that they could access after a five-year period).
Reform UK sets out tax reforms in Birmingham
Employers’ NIC reform was also key to Reform UK’s tax offering, with the party’s Treasury spokesman Robert Jenrick using this conference to reiterate previously announced plans to reverse the Autumn Budget 2024 rate rise from 13.8 percent to 15 percent, albeit only in respect of workers who are British citizens. Employers’ NICs for foreign nationals would remain at 15 percent.
However, the most eye-catching tax policy announced at conference was a new income tax pledge to raise the tax-free personal allowance from £12,570 to £15,000 within the first 100 days of a Reform Government. Jenrick claimed this would constitute a tax cut for 40 million people, saving the typical worker around £500, and stopping three million people from paying income tax altogether. TPA has noted that an increase to the personal allowance would disproportionately benefit higher-rate taxpayers and would not reduce marginal tax rates for the vast majority. It would also come with a significant price tag – estimated to be over £21 billion per annum by year five of a Reform Government. The party has said the cost would be fully funded by £80 billion of public spending cuts.
In the weeks preceding the conference, the party also promised to increase the VAT registration threshold from £90,000 to £150,000 and pledged to scrap income tax on overtime for employees earning under £75,000, if elected.
The party also confirmed it would reverse the ‘family farm tax’ and it repeated its commitment to scrap all environmental levies (including tax on gas generators from the UK Emissions Trading Scheme and the Carbon Price Support) and its plans to shift costs such as the Renewables Obligation and Feed-in Tariffs to the Treasury whilst they await repeal.
Liberal Democrats’ drive for growth
Income tax reform was front and centre at the Liberal Democrat conference in Brighton, with the party also launching proposals to raise the personal allowance to £15,000, as well as a pledge to raise the higher-rate income tax threshold from £50,271 to £56,000. Both tax cuts would be funded by the “dividends of growth” from rejoining the EU’s single market and customs union and would come into effect by 2034 if the party was elected.
Treasury spokesperson Daisy Cooper published a plan to “Get Britain Growing Again” at the conference which included, amongst other things, proposals to:
- Address “perverse” marginal rates and cliff-edges creating disincentives to work;
- Align CGT more closely with income tax whilst expanding reliefs;
- Consider a phased broadening of qualifying assets for full expensing, including intellectual property;
- Move to a system of up-front certainty for research and development (R&D) tax credits;
- Review the Patent Box to ensure it supports innovation across a broader range of sectors;
- Provide enhanced tax relief for qualifying training costs, with greater relief for training addressing critical skills shortages; and
- Review council tax, SDLT, and stamp duty on shares.
As well as these measures, the party reiterated several previously trailed announcements, such as a windfall tax on banks to fund loans for energy-efficient technology, a ‘family farm test’ to replace the Autumn Budget 2024 agricultural and business property relief reforms, and a ‘commercial landowner levy’ to replace the business rates system.
Wealth tax remains centrepiece of Greens’ tax policy
The Green Party conference in Brighton was light on new tax policy announcements, with the party repeating its pledge to introduce a standalone wealth tax of 1 percent on wealth over £10 million (and 2 percent over £1 billion). Leader Zack Polanski described this as a “day one” priority for the party in a speech to the New Economics Foundation earlier in the year.
In addition, the party continued to call for banks to be subject to greater windfall taxation, having proposed in August 2026 a 38 percent windfall tax on domestic profits above £800 million for the UK’s biggest banks. With the tax only being charged on net interest income and fees (e.g. mortgage fees) from UK retail banking, it would be specifically designed to remove incentives for banks to move operations abroad in response. Prior to the conference, Polanski had also called for a “real, loophole-free” windfall tax on energy companies, with no exemption for reinvesting in fossil fuels.
On employment taxes, the party proposed a ‘youth jobs guarantee’ whereby participating employers would receive NIC incentives for offering guaranteed employment opportunities in certain sectors to young workers. The party also pledged to double the employment allowance for SMEs.
SNP resolutions call for greater tax devolution
The SNP conference in Aberdeen came five months after Scottish elections in which the party won a fifth successive Holyrood election but ultimately fell short of an overall majority. The party did not announce any major new tax policies at the conference beyond those in the manifesto, which included commitments to ensure Scotland’s income tax system remains “the most progressive” in the UK (without increasing the number of bands or rates over the next parliament), putting in place a ‘private jet tax’, and introducing a ‘mansion tax’ from 2028.
Dave Doogan, the SNP’s Westminster Leader, used his conference speech to call on the UK Government to remove VAT from petrol and diesel “for the duration of this fuel crisis” and praised the recent Irish Budget, highlighting its extended cuts to VAT on gas and electricity, and the cut to VAT on certain hospitality businesses.
There were several noteworthy tax proposals raised at the conference by way of resolution, including:
- Devolution of retail taxation – which called for further devolution of taxation to Holyrood, specifically in respect of key retail tax powers over alcohol, tobacco and fuel;
- It’s Scotland’s energy – included an amendment calling on the UK Government to “increase profit levies on fossil fuel extractors and on polluting industries.” In the absence of this, the amendment states that the Scottish Government should explore any and all devolved powers, such as land taxes and environmental levies, to achieve the same effect; and
- Developing plans for a system of land taxation in Scotland – calling for devolution of powers allowing the Scottish Government to develop plans for Scotland’s own system of land taxation, which would be based on international examples of best practice and would help to address wealth inequality.
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