What is the Tax Gap?

The tax gap is the difference between the amount of tax that should be paid to Her Majesty’s Revenue & Customs (HMRC) each year and the amount that is actually paid. In 2020-2021 this figure was £35 billion.

This is money that could be spent on paying down our debt, meeting the cost of the pandemic, investing in the health service, tackling climate change, or helping level up the country. £35bn is as much as we spend on police, fire services, courts, and prisons every year. It would allow the funding cuts to the agencies and local authorities on which we rely on for protection to be reversed multiple times over.

The map below shows how big the Tax Gap is in each constituency in the UK, giving a picture of the uncollected tax that could be used to provide important public services.

How did we work out the Tax Gap for each constituency?

The Tax Gap figures for each constituency were arrived at by dividing the Tax Gap figure for the whole of the UK by the number of taxpayers, to give a figure for the average Tax Gap per taxpayer in the UK (£1118). This figure was then multiplied by the number of taxpayers in each constituency to give the Tax Gap figure per constituency. While not an exact figure, this allows us to give a good illustration of the amount of uncollected tax money across the UK and what it could be spent on.

The Goverment's Tax Gap statistics on which the map is based can be found here.