Introduction
In 2016−17, HM Revenue and Customs (HMRC) raised £574.9 billion of tax revenues, an increase of £38.1 billion (7.1%) on 2015−16. HMRC’s estimate of the tax gap has fallen from £35 billion (7.9%) in 2005−06 to £34 billion (6.0%) in 2015−16. HMRC paid out £39.1 billion in benefits and credits, approximately one-fifth of the government’s total benefits expenditure. HMRC’s estimate of error and fraud resulting in Tax Credits overpayments increased to 5.5% (£1.57 billion) in 2015−16 (the most recent year available), from 4.8% in 2014−15. The cost of running HMRC in 2016−17 was £3.3 billion, up from £3.2 billion in 2015−16. In 2016−17, HMRC improved its customer service by handling 92% of calls, compared to 72% in 2015−16. Its average speed to answer calls—measured from after a caller has listened to recorded messages and enters a queue to speak to an adviser—fell from 12 minutes in 2015−16 to under four minutes in 2016−17. HMRC transformation plans include 15 major programmes, including closing its national network of offices and relocating to 13 large regional centres, introducing new digital services for individuals and businesses, and updating major systems such as the Customs Declaration Service.
10 January 2017