Despite having the power since 2016, HMRC has never put a business into special measures and has been slow to review whether the threshold for using it is set at the right level. HMRC says that the special measures regime was initially intended to function as a deterrent and to incentivise large businesses to adopt responsible tax strategies. However, as HMRC has never put a large business into the regime, we found it difficult to know whether the claimed deterrent effect is real. The legislative threshold for using the special measures regime is high, even where a business is particularly aggressive in avoiding paying tax. Despite having special measures powers for 10 years, HMRC is only now reviewing 2 whether the powers are working well and exploring what barriers there are to using them more. We reported previously that HMRC makes limited use of its available powers elsewhere, such as its power to prosecute individuals for failing to prevent the facilitation of corporate tax evasion. This recurring trend damages the credibility of any future pleas HMRC may make for further powers. recommendation In its update to us in 12 months, HMRC should report on the findings of its review of the special measures regime, in particular setting out: a. what evidence it has on the deterrent effect of special measures, and any plans it has to improve this evidence; and b. what changes, if at all, it will seek to make to the threshold for using special measures and what impact it expects that change to have.