The tax system costs HMRC billions of pounds a year to administer. It also places administrative and financial burdens on taxpayers, in addition to the taxes they owe. Understanding how the elements of the tax system drive these costs is crucial to achieving a more efficient and effective administration.

HMRC is halfway through a ten-year tax administration strategy designed to “improve the tax system’s resilience, effectiveness and support for taxpayers”. HMRC sees this strategy as central to plans to reduce cost and increase efficiency.

This study will establish what progress HMRC has made in reducing costs and improving efficiency. It will provide transparency about the costs of different parts of the tax system now and in the future, and provide an independent perspective for HMRC to consider at the midpoint of their current strategy.


We will look at:

  • how costly the UK tax system is for HMRC, taxpayers and intermediaries, and what are the costliest parts
  • what the factors affecting costs are, and where the challenges lie
  • what the opportunities to reduce costs from the tax system are, for HMRC, taxpayers and intermediaries

NAO Team

Director: Andy Morrison
Audit Manager: Jeremy Gostick