Trust in HMRC at its lowest in six years, says Fair Tax

Public confidence in HMRC has reached its lowest point in six years according to a survey from the Fair Tax Foundation.

Under 50% of people said they would trust HMRC if they wanted to find out if a company was paying the right amount of tax.

Fair Tax stated that this was likely a consequence of the much publicised challenges it has faced as significant numbers of staff were redeployed to work on Brexit and Covid 19 support schemes.

HMRC opened fewer tax enquiries and prosecuted far fewer people for tax evasion during the pandemic.

Furthermore, the UK public also wants to see the Government do much more to ensure that all businesses, both large and small, pay their fair share of tax.

A large majority of respondents believe that multinational businesses should be forced to disclose how much income, profit and tax they pay in each country in which they operate.

Paul Monaghan, CEO, said: “The fall in trust with HMRC is worrying. There is a significant correlation between tax morale and tax compliance. Put simply, you are far more likely to pay your taxes if you think everyone else does so.

“Conversely, if you think that your neighbours are ‘at it’, then you are much more likely to seek to dodge taxes yourself. HMRC does excellent work, but it is under-resourced, despite the fact that for every £1 that HMRC spends on compliance activities, it recovers £18 in additional tax revenue.”

He added: “The UK Government needs to pursue a step change in the resourcing of HMRC’s compliance activities – this will not only enable the recovery of billions in lost revenue, but also ensure that trust in this venerable institution is rock solid.”