Recommendation 9

Evaluations typically cost between £50,000 and £250,000. The NAO estimated that HMRC had spent around £2 million on evaluating tax reliefs since 2015. HMRC has an annual central research budget of £2 million per year to fund evaluations of tax reliefs and other research to inform its wider business and HM Treasury priorities.14 We asked HMRC why it spent so little on evaluations compared to the value of taxes. It explained that its £2 million budget was for external research only and that it also undertook internal evaluations and analysis. However, it had no central record of the research it had conducted internally.15 HMRC was also unable to tell us how much it had spent on internal research, and in written evidence submitted after the hearing stated that it did not record activity spent on reviewing reliefs internally.16 HMRC accepted that it was important for it to focus on bringing together its internal analysis and publishing whatever information it could.17