Tax: Britain lost £35billion in taxes

HMRC looks to tackle the tax gap.

HMRC looks to tackle the tax gap.

The Treasury has admitted that Britain lost £35bn in uncollected taxes last year, equating to 7.9% of the annual tax revenue for the nation.

Whilst the margin of the difference between the amount of tax due and the total collected has been reduced from 8.1% of revenues of 2009, the Coalition has faced criticism for not reducing the losses as effectively as promised upon election. As a result, the Coalition has drawn plans to improve the efficiency of the tax collection system by simplifying it and targeting tax evasion. This comes after the Chancellor of the Exchequer, George Osborne, allocated £917m of funding to HM Revenue & Customs last year in the Spending Review to tackle tax issues.

Britain challenging offshore tax evaders.

Exchequer Secretary to the Treasury, David Gauke, looked to assure the country that HMRC is focused on challenging offshore tax evaders.

“Although these numbers show continued progress by HMRC in reducing the tax gap, there is no room for complacency. Just in the last few weeks we have challenged offshore tax evaders, closed tax avoidance loopholes and created a new HMRC unit to ensure that the wealthier members of society pay their share” he said.

Earlier this month it was announced that from May 2013, UK savers with accounts in popular tax haven Switzerland will be faced with the prospect of having to make a one-off payment to HMRC (19-34 per cent of their accounts), or allowing information about their accounts to be handed over.

HMRC tackling non-compliance

HMRC permanent secretary for tax, David Harnett focused on tackling non-compliance in order to reduce the tax gap even further.

“The tax gap is the result of a wide range of behaviours and the challenges are constantly changing, but these figures show we are continuing to tackle non-compliance. The tax gap has reduced from 8.5pc of total liabilities in 2004/05 to 7.9pc in 2009/10 and we have almost doubled compliance revenue since 2005 to £14bn” he added.

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