Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what recent estimate his Department has made of the number of workers employed in the UK shadow economy.

HMRC has not made any estimate of the number of workers in the shadow economy but has recently published research which focused on the hidden economy. The full research report is available here: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/654905/P11533_HE_Final_report_MASTER_draft_v6_0_PC_FINAL.PDF

The government is committed to achieving a significant and sustained narrowing of the hidden economy tax gap (the difference between the receipts actually collected and the amount of tax that should be collected if all taxpayers complied with the letter and spirit of the law). In recent years, there has been an increased focus on tackling the hidden economy using new data and smarter compliance work. To ensure that it becomes increasingly difficult for businesses to hide their income, the government has introduced new targeted data gathering powers, supporting interventions to prevent and respond to non-compliance. It has also invested in HMRC to recruit additional hidden economy investigators to make use of these new data streams and to combat this risk effectively.