The new head of HM Revenue and Customs, Mike Clasper, has made ‘closing the
gap’ one of four top priorities he has set the tax authorities.
The others are improving data security, raising the ‘customer experience’
and providing a new sense of direction for HMRC staff.
He spelled out his objectives in a foreword to the HMRC Autumn Report for
2008 in which he described these priorities as ‘central’.
Direct tax gap estimates showed that between 1999 and 2003 it increased from
11% to 15% of liabilities before declining slightly at a time when there was an
overall increase in SA liabilities related to the self-employed.
The report said the percentage VAT gap had fallen between 2002-03 and risen
in 2005-06 before falling again, with the reducing trend related to a
decline in Missing Trader Intra Community Fraud, estimated to have fallen
from £2.5 – £4.5bn in 2006-06 to £0.5 – £2bn in 2007-08.
Estimates showed the gap for income tax and national insurance collection
from firms with up to 500 employees has declined slightly from 1.1% of
liabilities in 2003-04 to 1% in 2004-05.
The gap estimated for corporation tax, covering firms not dealt with by the
Large Business Service, has varied between 15% and 18% between 2001 and 2003 but
fell to 9% in 2004, but the report warned of substantial sampling error and
suggested the gap is stable.
Richard Le Tocq, head of Locate Guernsey, discusses the chancellor’s approach to high net worth individuals, and why relocation is increasingly attractive to HNWIs
MTD represents 'the single most significant change to the UK’s system of taxation in recent times', says Knill James partner Nick Rawson. So, how prepared are SMEs for digital tax reporting?
The firm says that the U-turn 'does not alter the need for a fundamental review of the way we tax work' and that the current tax system is in need of reform
Legislation on the NICs changes to be brought forward in the autumn following publication of 'the full effects of the changes to Class 2 and Class 4' in the summer