10 February 2025
The National Audit Office (NAO) has released its latest report, The administrative cost of the tax system.
It covers the below topics:
- HMRC’s costs of administering the tax system increased by 15% (£563 million) in real terms between 2019-20 and 2023-24, with tax revenue rising at a similar rate.
- £15.4 billion estimated annual cost on businesses to comply with the tax system – but this is likely to be an understatement, and there is no equivalent estimate for individuals.
- Other challenges include upgrading HMRC’s digital systems – £482 million spent in 2023-24, but process has taken longer and has cost more than expected.
The report covers the UK tax system, focusing on the four highest revenue taxes:
- Income tax – PAYE and Self-assessment
- National Insurance
- VAT
- Corporation tax
About the NAO
The NAO is a body independent of government and the civil service, that examines public spending for Parliament. Helping parliament to hold government to account and provide insights to those that manage and govern public bodies to improve public services.
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