VAT Gap in tax year 2022 to 2023 is £8.8 billion, which is 5.3% of the net VAT total theoretical liability

HMRC statistics relating to VAT gap estimates.

• The VAT Gap is a measure of the difference between the expected amount of VAT that HMRC should receive and the actual amount they receive.
• It is calculated by comparing the net VAT total theoretical liability with the actual receipts.
• The preliminary estimate for the VAT Gap in tax year 2022 to 2023 is £8.8 billion, which is 5.3% of the net VAT total theoretical liability.
• This estimate shows a slight reduction compared to the previous year’s estimate.
• The calculation takes into account adjustments for the Energy Bills Support scheme and deferred VAT payments due to Covid-19. HMRC publishes three estimates of the VAT Gap each year, with the preliminary estimate being published in the autumn.
• The second estimate will be published in the spring.

Source gov.uk

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