HMRC spokesperson Nick McCarthy defended the agency’s efforts, noting that most businesses comply with tax laws. He added, “We will continue to use our civil and criminal powers against the determined minority who refuse to play by the rules.”
McCarthy also highlighted that HMRC’s actions helped protect £41.8 billion in tax revenue over the last year. However, the tax gap — the difference between expected and collected revenue — was estimated at £39.8 billion for 2022-23, which represents 4.8% of total tax liabilities.
HMRC £4B Tax Evasion : Calls for More Focused Action
Critics, including campaign groups such as Tax Justice and TaxWatch, argue that HMRC’s efforts are too scattered. Claire Aston, director of TaxWatch, called for HMRC to focus its resources on more pernicious businesses and fully utilize its powers to combat tax evasion effectively.
Despite these challenges, HMRC has made some progress, collecting an additional £1.5 billion in value-added tax (VAT) annually by holding online platforms accountable for VAT on overseas sales. However, the NAO report noted that significant gaps remain in monitoring these platforms.
