The UK is in a fiscal tight spot. The Chancellor has promised to raise an additional £7.5 billion over the next four years by boosting HMRC compliance efforts. The Autumn Budget is likely to see more measures intended to make this number go up: perhaps extra compliance funding, new powers, additional anti-avoidance legislation.
In a new article for HMRC Enquiries, Investigations and Powers, TaxWatch’s Mike Lewis takes a look (pdf) at the strategic choices that HMRC faces in boosting the compliance element of its efforts to close the tax gap (which HMRC estimates now stands at £46.8bn for 2023/24). Should it focus on the tax system’s much-discussed “men in white vans” problem? Or is it more effective – and perhaps fair – to dedicate resources to larger taxpayers and other kinds of avoidance and evasion?
Finally, we ask whether the incidence of tax enforcement matters, in an analogous way to tax incidence itself. If so, do we need a ‘fair tax enforcement index’, and how would one be created?
The full article is here.
(Image: Ucumari Photography / Flickr CC BY-NC-ND 2.0)
