Call for action on ‘complex, uncosted and exploited’ tax reliefs

The Treasury Committee has called for ‘a comprehensive and systematic review’ into the cost of over a thousand tax reliefs. The new report concludes that the tax system is too complex and the scrutiny of existing reliefs is inadequate which has contributed to the abuse of some tax reliefs and in certain cases fraud.

During its inquiry the committee heard there are over 1 180 tax reliefs in operation but just 365 have official costings. While the overall cost is unknown HMRC analysis found that 105 of the 1 180 reliefs cost £195bn.

The committee has called on HMRC to publish costings for all reliefs from the 2025–26 tax year onwards. It also recommends the government:

• consider how individual departments can take more responsibility for budgeting reliefs to increase ministerial accountability and oversight;
• introduce five-yearly reviews of tax reliefs and removes reliefs...