PAC demands better efforts to catch ‘abusive’ companies

Better efforts need to be made by HM Revenue & Customs in the targeting
and scrutinising of tax returns of companies that may be abusing the tax system,
the Commons public accounts committee will say in parliament today.

This follows research which showed that a large proportion of inquiries
produced no extra revenue.

It found that 40% of tax returns contained errors which if undetected would
result in a tax loss, but only 60% of tax office inquiries produced additional

‘The department needs to improve the targeting of inquiries and thereby
increase the tax yield,’ the PAC said.

Edward Leigh, committee chairman, said: ‘The department should find out which
types of company are most likely to try to abuse the system and also which types
are prone to making genuine mistakes in their returns.’

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