United Kingdom: Technical Assistance Report—Assessment of HMRC’s Tax Gap Analysis
IMF Staff Country Reports, October 22, 2013
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- United Kingdom: Technical Assistance Report—Assessment of HMRC’s Tax Gap Analysis
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Bibliographic details
- Published: October 22, 2013
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484303276.002
Overview
- This Technical Assistance Report assesses HMRC’s (Her Majesty’s Revenue and Customs) Tax Gap Analysis program in United Kingdom and provides advice and guidance on further improving it.
- The HMRC’s tax gap analysis program is described as comprehensive in tax coverage, and effectively addresses its multiple dimensions.
- The report raises areas of possible further research to strengthen the program.
Main assessment findings
- The program is comprehensive in tax coverage.
- The program effectively addresses multiple dimensions of the tax gap.
- The report identifies opportunities to further improve models, dissemination, and use of results.
Aspects of the program examined
- Models and methodologies employed:
- Assessment of the estimation framework and estimation methodology.
- Review of specific gap models referenced in keywords: Gap model, RA-gap VAT Gap model, VAT Gap model, ISCR.
- Approach to disseminating the results:
- Evaluation of how HMRC communicates tax gap results and aggregate tax gap number.
- Use of results in policy and administration:
- Use of results in supporting compliance activities.
- Use of results in evaluating tax revenue performance across taxes and the effectiveness of HMRC.
- Consideration of the policy gap and measurement process for Income and capital gains taxes, income tax, and Consumption taxes.
Policy recommendations and areas for further research
- Improve and refine models and methodologies used to estimate tax gaps.
- Enhance dissemination approaches to increase clarity and utility of published results.
- Strengthen the linkage between tax gap results and HMRC compliance strategies and performance evaluation.
- Pursue targeted further research on aspects of the measurement process, model robustness, and the interpretation of aggregate tax gap numbers.