HMRC is failing to collect billions of pounds of tax it is owed each year that could have helped further fund local public services, MPs have warned.
In a report published today, the Public Accounts Committee (PAC) urged HMRC to employ more compliance staff to chase debts during the current real-terms squeeze on public spending after finding 5% of tax it is owed each year – some £42bn for 2021-23 – was not collected.
PAC chair Meg Hillier said: ‘The eye-watering £42bn now owed to HMRC in unpaid taxes would have filled a lot of this year’s infamous public spending black hole, but the public purse will continue missing out on billions of desperately-needed revenues as HMRC will only employ more staff to tackle compliance over the next few years – not fast enough to dent the tax gap at a time of huge public sector spending pressures.’
The report said that for every £1 HMRC spends on compliance activities it recovers £18 in additional tax revenue.
It added: ‘The failure to better resource compliance means Government is missing the opportunity to recover billions in lost revenue.’
This article was originally published by The MJ (£).
