A Conservative government would end inheritance tax on family homes worth up to £1m, David Cameron is to announce.
It means most homeowners in the UK would be able to pass on money to their children without paying tax.
The policy is likely to be at the centre of the Tory election manifesto, which will be launched next week.
It comes as Labour announced a fresh crackdown on tax avoidance and the Lib Dems set out their economic plans.
The £1bn cost of the Conservative policy will be paid for by reducing tax relief on the pension contributions of people earning more than £150,000.
If the party wins the general election 7 May, parents will each be offered a £175,000 allowance to enable them to pass property on to children tax-free after their death.
The new "family home allowance" will be transferable on the death of one spouse and can be added to the existing £325,000 transferable allowance to bring the tax-free total up to £1m.
The full amount would be transferable even if one member of a married couple has died before the policy comes into effect, the Conservatives say, and will benefit existing widows and widowers.
For properties worth more than £2m, the allowance will be gradually tapered away, so that those with homes worth more than £2.35m would not benefit at all.
The policy would come into effect in April 2017.
In a speech on Sunday, Mr Cameron will say: "That wish to pass something on is about the most basic, human and natural instinct there is. And that's why for a long, long time I have wanted to act on inheritance.
"We've already done some important things. With the Conservatives, people can pass on their ISAs - and they'll be able to pass on their pension pot tax-free.
"And I can tell you today that the next Conservative government would go much further. We will take the family home out of inheritance tax.
"That home that you have worked and saved for belongs to you and your family.
"You should be able to pass it onto your children. And with the Conservatives, the tax man will not get his hands on it."
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