The House of Commons Public Accounts Committee has been looking at the management of H M Revenue & Customs - and rightly so.
As they note, and Private Eye report, 22 companies in the UK are disputing tax of more than £250 million each - a total sum of £14.9 billion.
And you want to tel me that the tax gap is not as big as I estimate - at £12 billion a year in total for UK corporates?
Sorry, but all the evidence stacks in my direction.
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The fact that tax is disputed does not prove there is a tax gap.
And I’m getting very confused about the numbers being bandied about – you say here that corporate tax gap is £12bn, yet I’ve seen you say the total tax gap is about £120bn. Are you just plucking numbers out of thin air?
My hunch is that the £120bn figure is a fantasy number.
@Alex Pritchard
Just do your research and stop making lazy comment
http://www.taxresearch.org.uk/Documents/PCSTaxGap.pdf
Being lazy myself, it’s fairly clear that some of this won’t be due, some of it will be due and some of it, nobody really knows and it will be impossible to work out so a compromise will be reached. In the end a good chunk of this 14.9 billion will probably be agreed to be payable. That is a sizeable amount of money. Anyway, this is just the unpaid tax which is on the radar of HMRC. There is bound to be plenty more which HMRC don’t even know enough about to dispute, not to mention the tax which may be due, but due to questionable record keeping, even the companies concerned don’t know about!
Alex, the CT gap is just part of the total tax gap which includes PAYE, NIC, VAT and income tax.
120bn figure comes from the PCS after research by the Tax Justice Network. you can read here. It is estimated that £25bn a year is lost through tax avoidance, £70bn in tax avoidance and £26bn is uncollected. Meaning a grand estimated total of…120bn.
Therefore this 120bn is not a fantasy number. Hope that clears it up.
http://www.pcs.org.uk/en/campaigns/campaign-resources/there-is-an-alternative-the-case-against-cuts-in-public-spending.cfm
sorry that should read 70bn in tax EVASION