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UK tax gap narrows, billions still left uncollected

The news that the UK tax gap – the difference between tax collected and tax owed – has narrowed to 6.4% is welcome news for both the Treasury and the economy as a whole. Despite this fall, from 6.6% in 2012/2013, there is still a staggering £34bn to be collected, showing there is still much to be done, says ACCA (the Association of Chartered Certified Accountants).

Chas Roy-Chowdhury, ACCA head of taxation, said: “It is a huge credit to the staff at HMRC that they have managed to lower the tax gap despite constant cuts to their budget. However with £34bn still uncollected, and the government struggling to meet its borrowing target the Chancellor should reconsider his decision to cut HMRC’s resources.

“Corporate tax avoidance may be falling but there is still a sizeable amount lost due to innocent mistakes and evasion. It is in these areas where more resources for HMRC could be best deployed. In helping guide those who want to pay the right amount of tax and in investigating those who are determined not to pay tax.

“We should also remember that these figures include £1bn collected from accelerated payment notices. Those are a one off catch-up from historic schemes that won’t be repeated – and there is always the risk that even some of those amounts will have to be returned, as taxpayers are challenging HMRC’s approach in this area.”

Visit: https://www.gov.uk/government/publications/issue-briefing-calculating-the-2013-to-2014-tax-gap for HMRC’s statement on the latest tax gap figures.

This was posted in Bdaily's Members' News section by ACCA .