... The Taxpayers' Alliance:
Every year Her Majesty’s Revenue and Customs (HMRC) estimates how much tax revenue is lost to the black market. The annual report, Measuring Tax Gaps, is an annual report looking at a range of ways in which HMRC loses out on revenue from a range of direct and indirect taxes.
The tax gap is largest when it comes to duties on tobacco, alcohol and diesel – the most highly taxed products.
That was news to me, so I thought I'd better check HMRC's actual report first before I lay into them.
By absolute amount of tax 'lost', the rankings are:
Income Tax, National Insurance Contributions & CGT: £15.5 bn
Gross Profits Tax Value Added Tax: £12.7 bn
Corporation tax: £3.7 bn
Excise duties: £2.8 bn
By amount 'lost' relative to amount of tax collected, the ranking are
Gross Profits Tax Value Added Tax: 10.3%
Corporation tax: 8%
Excise duties: 5.3%
Income Tax, National Insurance Contributions & CGT: 5.2%
So the 'tax gap' for Excise Duties is smallest in absolute and relative terms. Duh.
Sadly, HMRC are not responsible for Business Rates (quasi-LVT) so do not publish the 'tax gap' for that which is - unsurprisingly - about 1% or 2%.
Debate Magazine
