HMRC won’t reveal offshore tax loss figures
The UK tax authority, HMRC, reportedly has the data required to estimate the amount of tax lost through offshore havens, but it refuses to make that information public.
Request for transparency
An MP has urged HMRC to release its official estimate of tax lost to offshore shelters. A Freedom of Information request from TaxWatch, shared with The Bureau of Investigative Journalism, revealed that HMRC possesses the necessary data to calculate the offshore tax gap but has withheld it.
“We urgently need HMRC to clarify the situation – otherwise we will never crack down on tax dodging,” said Lloyd Hatton MP, member of the Public Accounts Committee.
What the offshore tax gap means
The offshore tax gap represents the difference between the revenue the UK should receive from offshore sources and what actually arrives. It reflects the financial cost to the public when individuals and corporations move money abroad to avoid, evade, or fail to declare taxes.
Conflicting statements from HMRC
While HMRC has previously stated that it lacks any estimate for the overall offshore tax gap, its response to the recent FOI request confirmed that it does hold figures for “offshore tax at risk.” This value represents tax HMRC considers potentially lost due to avoidance, evasion, and non-compliance. The authority also acknowledged that this figure could serve as a basis for calculating the offshore tax gap.
Author’s summary: HMRC’s withholding of offshore tax loss estimates raises concerns about transparency and efforts to combat tax dodging.