Thirty-Third Report - HMRC performance in 2021–22

Select Committee
Public Accounts Committee HC 686 11 January 2023
Report Status Government responded
Conclusions & Recommendations 23 items (10 recs)
Source View on Parliament website
Government Response (AI assessment · 22 of 23 classified)
Accepted 13
Acknowledged 4
Not Addressed 1
Rejected 4
Government response
Treasury minutes: Government response to the Committee of Public Accounts on the Thirty third report from Session 2022-23 · published 12 Apr 2023
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Recommendations & Conclusions

4 results
2 Recommendation Rejected
Resourcing HMRC’s compliance work to maintain rather than reduce the tax gap means the government...
Recommendation
Resourcing HMRC’s compliance work to maintain rather than reduce the tax gap means the government is missing out on billions in lost revenue. HMRC estimates that the tax gap—the difference between the amount of tax that should, in theory be … Read more
Government Response Summary
The government disagrees with the recommendation to set out the level of investment needed to reduce the tax gap and to report an uncertainty range for the tax gap estimate, stating that funding levels are a decision for Treasury ministers and that they have a track record of investing in compliance work.
HM Treasury
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9 Conclusion Rejected
With the resources it was given in the 2021 Spending Review, HMRC’s aim is to...
Conclusion
With the resources it was given in the 2021 Spending Review, HMRC’s aim is to maintain the tax gap and prevent it from growing. For every £1 that it spends on compliance activity, it said it recovers £18 in additional … Read more
Government Response Summary
The government disagrees, stating that HMRC's funding levels are a decision for Treasury ministers based on advice from HMRC and HM Treasury officials, and it is right that this advice is considered in private.
HM Treasury
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21 Recommendation Rejected
The government has a target of 2.4% of GDP to be spent on research and...
Recommendation
The government has a target of 2.4% of GDP to be spent on research and development.32 To encourage this investment, HMRC administers tax reliefs to companies via two schemes – one for large companies and one for small and medium-sized … Read more
Government Response Summary
The government disagrees with the recommendation, stating that HMRC has already published reports on the additional R&D expenditure stimulated by tax relief schemes and that further analysis will be carried out in the future but not within 12 months, although an update will be provided within that period.
HM Treasury
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22 Conclusion Rejected
In 2021–22, HMRC granted research and development tax reliefs worth £9.5 billion.34 HMRC said the...
Conclusion
In 2021–22, HMRC granted research and development tax reliefs worth £9.5 billion.34 HMRC said the relief is an attractive target for abuse, whether by companies that have not carried out any research and development or by advisors encouraging companies to … Read more
Government Response Summary
The government disagrees with the recommendation, stating that HMRC has already published reports on the additional R&D expenditure stimulated by tax relief schemes and that further analysis will be carried out in the future but not within 12 months, although an update will be provided within that period.
HM Treasury
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