Tax gap maintains downward trend

The tax gap for 2013/14 was £34bn which is 6.4% of tax due down from 6.6% in 2012/13 according to HMRC. The department states that the percentage tax gap has reduced steadily since 2005/06 when it was 8.4%.

There has been a sustained downward trend for large and small businesses with the overall reduction driven mainly by large businesses.

Chas Roy-Chowdhury ACCA head of taxation said: “It is a credit to the staff at HMRC that they have managed to lower the tax gap despite constant cuts to their budget. However with £34bn uncollected and the government struggling to meet its borrowing target the chancellor should reconsider his decision to cut HMRC’s resources.

“Corporate tax avoidance may be falling but there is still a sizeable amount lost due to innocent mistakes and evasion. It is in these areas where...