UK's tax authorities, HMRC, have admitted their inability to pinpoint the exact number of billionaires contributing to the national tax revenue.
The Public Accounts Committee (PAC) has raised concerns about the lack of clarity surrounding the tax contributions of billionaires in the UK, as HM Revenue and Customs (HMRC) lacks a legal mechanism or dataset to track them effectively [1][3][4].
The PAC has called on HMRC to publish a clear plan for increasing tax yield from wealthy individuals, both domestically and offshore, and to set out explicit timelines for achieving these objectives [2][3]. One of the ways the committee suggests HMRC could improve its understanding is by cross-referencing public data on known billionaires, such as the Sunday Times Rich List, with internal tax records [3].
HMRC has acknowledged the need to collect more information from wealthy individuals with complex affairs, in line with international best practice [2]. However, no firm plans or timescales have been established for this initiative [2]. The government agency points out that any significant expansion in data collection—such as requiring wealth declarations—would likely require ministerial decisions and possibly new legislation [2].
In addition to increasing its compliance yield from wealthy individuals, HMRC has highlighted the value of international cooperation, including data-sharing agreements, to improve access to information about offshore assets and income [2]. The agency also expects future improvements from enhanced crypto asset reporting and the register of overseas entities, which may provide additional data on wealth held abroad [2].
Significant political pressure, particularly from Labour MPs, is being applied to introduce a wealth tax on the super-rich, with proposals such as a 2% tax on assets over £10 million, which proponents claim could raise up to £11 billion per year [1]. However, no government commitment to such a move has been made yet.
The PAC's role does not involve political debate around the redistribution of wealth, but rather ensuring that HMRC does its job properly and achieves its goal of helping the government reach a true accounting of what is owed from the wealthiest in society [3]. The committee has expressed disappointment that HMRC cannot offer insights into the tax arrangements of billionaires from its own data [5].
The government has secured extra resources to significantly step up its work on closing the tax gap among the wealthiest, with approximately 1,000 people within HMRC currently focused on the tax affairs of the UK's wealthiest, and funding has been secured to increase this headcount by 400 [3][5].
In conclusion, HMRC acknowledges the need to improve tax collection from billionaires and is considering steps like better use of international data and new reporting regimes, but has not yet developed a concrete, actionable plan [2][3]. Significant progress will likely depend on political decisions to mandate wealth reporting or introduce new taxes targeting the ultra-wealthy, as currently advocated by some MPs and former party leaders [1]. Until then, the lack of legal authority and clear ministerial direction remains a major obstacle to increasing tax contributions from UK billionaires [2].
The Public Accounts Committee has urged HMRC to establish explicit timelines for increasing tax yields from billionaires, both domestically and offshore, suggesting cross-referencing public data with internal tax records [2][3]. Despite acknowledging the need for improvement, HMRC's lack of a concrete, actionable plan, coupled with the absence of clear ministerial direction, remains a significant obstacle to collecting more tax from UK billionaires [2].
