HM Revenue & Customs (HMRC) has made ‘limited progress’ in reducing the level of tax fraud in the UK, the Public Accounts Committee (PAC) has stated.
Members of the Committee have said that taxpayers are losing out on £16 billion a year as a direct result of tax evasion and fraudulent activity.
The PAC has also claimed that the current anti-tax fraud strategy is ‘unclear’, particularly in its approach to prosecutions.
MPs are now calling for HMRC to increase the number of tax fraud investigations and prosecute those who fail to pay their taxes.
Chair of the PAC, Meg Hillier, said: ‘We have long felt that there should be more prosecutions because we think that sends a signal to the honest taxpayer who is sweating over their tax returns and also a warning shot to those who are thinking about being fraudulent’.
However, HMRC has previously revealed that, in recent years, there has been a rise in the overall amount of tax receipts.
‘HMRC is one of the most effective tax collectors in the world, getting 93 pence of every pound due,’ a spokesperson commented.
As a result of additional funding provided to HMRC in the Summer 2015 Budget, the Revenue has stated that it hopes to investigate 100 businesses’ and individuals’ tax affairs every year by 2020.