Reform UK leader backs off tax cuts, leaving brokers warning of worsening affordability strain
Image Caption: Derek Bennett, CC BY 2.0 <https://creativecommons.org/licenses/by/2.0>, via Wikimedia Commons
Nigel Farage has dropped plans to scrap stamp duty on homes under £750,000 and other major tax cuts, conceding that “substantial” reductions are “not realistic” given the state of public finances.
The Reform UK leader said the party would instead pursue “modest” fiscal changes and spending restraint, a reversal of its 2024 manifesto which pledged £90 billion in annual tax reductions.
“We want to cut taxes, of course we do,” Mr Farage told supporters in London. “But we understand substantial tax cuts, given the dire state of debt and our finances, are not realistic at this current moment in time.”
Brokers warn of knock-on strain
Mortgage advisers say the retreat on property-related tax cuts will compound affordability pressures already weighing on borrowers. In Kent, where a Reform-led council has proposed a 5 per cent council-tax rise to close a budget gap, brokers told Mortgage Introducer that even modest increases in household outgoings can tip clients beyond lending limits.
“Every extra outgoing now counts,” one broker said. “For first-time buyers in particular, higher local taxes are another drag on affordability.”
The policy shift adds to scepticism among housing-market professionals over whether Reform’s economic plans can deliver meaningful relief for homeowners or spur mid-market activity.
Focus on spending before cuts
Mr Farage said a Reform government would move ahead only with limited measures, such as scrapping inheritance tax for family farms and family-run businesses, while targeting savings in welfare spending, pensions and the Civil Service.
“We can’t have massive tax cuts until the markets can see we’ve at least got these things in hand,” he said, predicting that worsening market confidence could even trigger a general election in 2027.
He reaffirmed his “aspiration” to lift the income-tax threshold to £20,000 but admitted such a move would have to wait until “the markets stabilise”.
Industry response and political fallout
Labour accused Mr Farage of “taking Britain back to austerity”, while Conservatives said Reform’s platform had “disintegrated after five minutes”.
For mortgage professionals, the retreat on stamp-duty reform removes a potential catalyst for market activity. Instead, analysts say the outlook now hinges on whether any future fiscal easing, however modest, can offset rising local levies and the lingering impact of higher rates on buyer budgets.
