Conclusion 3

HMRC cannot identify how much tax is paid by UK billionaires, despite the relatively small number of individuals and significant sums of money involved. HMRC can and must do more to understand and explain the contribution that the very wealthiest in society make to tax revenue. It has access to a wide range of internal and external data which it uses to identify wealthy individuals, but we are disappointed that it cannot use these data to provide some transparency about the tax paid by the wealthiest. HMRC argues that income and chargeable gains determine whether you pay tax, not whether you are a billionaire. HMRC does not collect information on taxpayers’ wealth and says that it only collects the data needed to administer the tax system as required by UK tax legislation. A billionaire has wealth and assets 500 times greater than a wealthy individual who just meets HMRC’s threshold for the wealthy population and so has huge potential on their own to affect the tax gap, and how much revenue is available for public spending. In the United States, the Inland Revenue Service has worked with researchers to link its data to the Forbes 400. HMRC has not facilitated a similar analysis with the Sunday Times Rich list. recommendation Alongside its Treasury Minute response, HMRC should write to the Committee with its plans for improving its understanding of the wealth and assets held by the wealthiest individuals, including billionaires. This should include: 4 • work it can implement straightaway on comparing available data on known billionaires, such as the Sunday Times Rich List, with its own records; • the steps it will take to request more data on assets and wealth from those taxpayers it suspects have high or very high levels of wealth, taking into account that any additional administrative burdens on the very wealthiest are likely to be perfectly manageable given their resources; and • work it will undertake, and associated timeframes, to better understand the links bet