HMRC is chasing 9bn.

HM Revenue & Customs is under pressure to urgently recoup tax revenue after the parliament spending watchdog revealed that a sharp fall in investigations during the pandemic had cost the government as much as £9bn. HMRC investigated around 30 per cent fewer compliance cases in 2020-21 compared with the previous year. The NAO found that approximately 12 per cent of HMRC staff, or 1,350 employees, who usually focus on recovering taxes, were moved to administer the government’s flagship Covid-19 support schemes. Gareth Davies, head of the NAO, said HMRC had to move swiftly to reallocate resources to Covid-19 schemes.

But the reallocation of staff had «affected its ability to investigate cases». The total amount of tax collected by HMRC in 2021-22 was £731.1bn. The Chartered Institute of Taxation, an industry body, said the reduction in the collection of unpaid taxes was «clearly a concern» but noted that HMRC still expected to recover a «big chunk» of money owed. In his Autumn Statement, chancellor Jeremy Hunt announced the government would spend £79mn over five years allocating more staff to tackle cases of serious tax fraud, which he forecast would raise an extra £725mn over the same period.

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