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According to HMRC, tax doesn’t have to be taxing.
Yet thanks in part to an overly complex tax code system, the taxman has missed out on £27bn in the past five years. Stretched to the limit, a recent report showed that around half of calls placed to the authority go unanswered, while postal correspondence is replied to only after a matter of months.
Of course the economic climate over those five years hasn’t helped matters, with business closures contributing significantly to the incredible level of unpaid tax. 90% of debts written off are due to company liquidation.
But the failings of the tax body affect us all.
Last year, for example, HMRC had to write off £5.9bn of tax that it was simply unable to collect. Had they managed to claim what was owed to them, it would have resulted in more than 1% off VAT.
Speaking of VAT, HMRC wrote off more than £2bn of it in the last financial year. The taxman also missed out on income tax, corporation tax, national insurance – you name it.
For many commentators, the chronic underpayment is due largely to the overcomplicated nature of the UK tax system.
It has been pointed out that at 1,897 pages long, Tolley’s Corporation Tax Guide would take more than five days straight to reel off!