Tax gap falls to 6.4%, remaining at around £34bn in cash terms
THE TAX GAP fell to 6.4% from 6.8% of tax due for 2013/14, remaining static in cash terms at around £34bn, figures from HM Revenue & Customs show.
The gap has been relatively consistent in value since 2004/05 – the furthest back estimates go – with the lowest figure coming in 2009/10 at £31bn and highest being £37bn in 2006/07.
In two of the nine years, the tax authority, posted a £33bn shortfall. The gap is regularly revised to take account of improved methods and the latest available information, and the figures published today include revisions going back to 2005/06. Overall, the figures show an additional £57bn in cumulative tax collected over the nine-year period.
The largest reduction is in the corporation tax gap which has halved since 2005/06, from 14% to 7% of relevant tax liabilities.
In his Summer Budget, the chancellor announced a range of new measures including an £800m investment over the course of the parliament to bolster HMRC’s ability to tackle evasion, avoidance and improve compliance.
Financial secretary to the Treasury David Gauke (pictured) said: “The UK has one of the lowest tax gaps in the world, and this government is determined to continue fighting evasion and avoidance wherever it occurs. If the tax gap percentage had stayed at its 2009/10 value of 7.3%, £14.5bn less tax would have been collected.”
“There is understandable anger when individuals or companies are perceived not to be contributing their fair share, but we can reassure the public that the proportion going unpaid is low and this government is dedicated to bringing it down further.”