Following the publication of HMRC’s Measuring Tax Gaps – 2019 edition, Jason Piper, head of taxation at ACCA, said:
‘Whilst the Corporation Tax gap has reduced from 12.5% to 8.1% in 2017-18 in a little more than ten years, the biggest single taxpayer group responsible for the tax gap is small businesses (£14 billion), costing society nearly twice as much as big business (£7.7 billion).
‘This doesn’t mean HMRC should devote twice as much resource to small business as big business. In reality it should probably devote even more than that to the issue. The challenges of dealing with this sector differ from that of multinationals.
‘Small businesses by definition will have smaller tax bills, which means that HMRC will need to open more enquiries and handle more pieces of correspondence per pound than for large businesses. However it is vital that HMRC remains sensitive in managing SME relationships every bit as carefully as they do multinationals.’
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