23 Sep 2014
The Public and Commercial Services Union (PCS) and Tax Research LLP have released findings of their probe into tax evasion and avoidance.
The total tax gap, which is ‘the difference between the tax that should be paid in the UK if the tax system worked as parliament and HMRC intended, and the amount actually paid’, is estimated to be over £119 billion in total for 2013/14.
According to the PCS, tax evasion cost the UK £73.4 billion in 2011/12, while official Government figures put losses from tax evasion at a mere £22.3 billion.
The PCS 2013/14 prediction is that tax evasion now stands at £82.1 billion. Over half of this figure is down to trading in the shadow economy.
The rest of the tax gap was accounted for by tax avoidance – defined as ‘tax that is lost when a person claims to arrange their affairs to minimise tax within the law in the UK or in other countries’ – at an estimated £19.1 billion; and also unpaid tax debt which amounts to £18.2 billion.
The report can be found here, and shows that tax avoidance totals actually dropped in 2013/14 compared to £25 billion in 2008. £25 billion was also the estimated figure for unpaid tax debt in 2008, which has also dropped significantly.