Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what estimate his Department has made of the level of investment required in HMRC compliance teams to reduce the size of the tax gap.

The Government is committed to tackling tax avoidance, evasion, and all other forms of tax non-compliance. Our tax gap is on a long-term downward trend and is among the lowest worldwide, falling from 7.5 per cent in 2005-06 to 5.1 per cent in 2020-21.

HMRC has considerable resources and staff numbers to tackle non-compliance in the tax system. As set out in HMRC’s Annual Report and Accounts, in the last three financial years HMRC’s Customer Compliance Group has spent £3.8 billion on tackling avoidance, evasion and other forms of non-compliance, including £1.2 billion in 2019-20, £1.2 billion in 2020-21, and £1.4 billion in 2021-22.

At Autumn Statement 2022 the Government announced a further £79 million investment to enable HMRC to allocate additional staff to tackle more cases of serious tax fraud and address tax compliance risks among wealthy taxpayers. This is forecast to bring in £725 million of additional revenue over the next five years.