HMRC criticised over £32bn ‘tax gap’ estimate

A tax expert said the assessment of tax losses to the exchequer was ‘half-hearted’ and that losses would have been higher. Photograph: Radharc Images/Alamy

HMRC was accused on Thursday of underestimating the tax gap – the difference between the expected income for the exchequer and actual receipts – after official figures showed it was unchanged during the first year of the pandemic.

The Revenue said there was a 5.1% shortfall worth £32bn in the 2020-21 financial year, the same as the period before the pandemic took effect. It said fraud accounted for £2bn of the total – despite widespread concerns that tens of billions of pounds in government pandemic spending was lost to fraud.