§ Mr. Malcolm BruceTo ask the Chancellor of the Exchequer what estimate he has made of uncollected(a) income tax, (b) corporation tax, (c) value added tax and (d) other taxes in (i) 1991–92, (ii) 1994–95 and (iii) 1995–96; and if he will make a statement. [3385]
§ Mr. Jack[holding answer 11 November 1996]: The information is given in the following table. In this question, "uncollected" has been taken to mean "uncollected and subsequently written off or remitted".
Inland Revenue collection accounts are drawn up each year to the end of October, and the table therefore shows the amounts as at the end of October 1991, October 1994 and October 1995 (the latest date for which figures are available). Customs and Excise accounts are drawn up for each calendar year.
Amount remitted/written off £ million Type of tax October 1991 October 1994 October 1995 Income tax 524 853 593 Corporation tax 321 262 127 Other taxes 39 44 36 Value added tax 515 550 484 Customs and other duties 0.7 1.7 5.9 The boards of Inland Revenue and of Customs and Excise allow remissions of tax on a case-by-case basis as an aspect of their responsibilities for the care and management of the various taxes.
Sound management requires that tax which is not collected and which cannot practicably be collected—for example, because the taxpayer is insolvent or his whereabouts are unknown—should be written off.
Insolvencies, where the Inland Revenue and Customs and Excise have very little control over the amount recoverable, account for the vast majority of tax written off.