Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what discussions she has had with the Chief Executive of HMRC on reducing the tax gap.

As the Minister responsible for the UK tax system, I regularly discuss a wide range of issues with the Chief Executive of HMRC, including reducing the tax gap.

Closing the Tax Gap is a government priority. Over the last three fiscal events the Government have announced tax gap measures which cumulatively ensure £10bn of tax that would otherwise have been uncollected will be received by the Exchequer in 2029/30. Much of this is from action to tackle the small business tax gap – for example, investing £1.7 billion in HMRC compliance systems and additional capacity, alongside making greater use of third-party data to identify and tackle non-compliance.

In relation to Corporation Tax specifically, HMRC is exploring improving the information they get to better identify and address risks, by setting minimum standards for software. The government is also consulting on getting better data about the transactions between close companies and their participators. All of this will reduce the tax gap by encouraging better compliance by taxpayers and provide HMRC with better data to target interventions.

HM Revenue and Customs publish estimates of the tax gap by tax type and customer behaviour, which includes the proportion attributable to taxpayer error or failure to take reasonable care. These can be found here: Measuring tax gaps 2026 edition: tax gap estimates for 2024 to 2025 - GOV.UK. HMRC does not produce an estimate of the proportion attributable to tax system complexity.