HM Revenue & Customs (HMRC) will receive a budget boost of £900m to crackdown on tax avoidance and claw back money owed.
In his Spending Review, Chancellor George Osborne said the investment would help reclaim £7bn in taxes lost through fraud and avoidance owed to the public purse.
Revenues & Customs has faced criticism for a string of recent failings, including revelations the HMRC computer system was telling people they were owed five-figure tax refunds.
Today George Osborne also announced a much tougher approach to tax avoidance by banks, after it emerged only four out of the 15 biggest banks operating in Britain have signed up to a code of conduct.
Individuals are also being targetted over avoidance. Last month HMRC wrote to hundreds of wealthy UK tax payers over possible large scale tax evasion, after it acquired a list of high net-worth individuals with accounts at the Swiss division of HSBC.
However in addition to the budget boost HMRC must also find 15% of efficiency savings.
The Revenue service is currently embroiled in problems with the PAYE tax system which could continue for at least two years at a cost of £170m.
Paul Harrison, tax partner at KPMG in the UK, says: "We condemn all forms of tax evasion and therefore support any sensible measure to stamp it out.
"We encourage the Government and HMRC to look for targeted and efficient ways to achieve this. This would include ensuring innocent tax payers are not targeted inappropriately.
"We would also encourage HMRC to look for ways to encourage voluntary disclosure and compliance."
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