HMRC failed to collect £9.6bn of VAT in 2010-11 and has widespread error and fraud in the payments of personal tax credits, according to a report by the government's independent auditors.
The £9.6bn figure is one third of the total estimated "tax gap", according to the NAO, which gave a mixed verdict on HMRC's 2012-13 accounts.
The watchdog also found that HMRC does not does not carry out comprehensive checks of company's VAT returns. And HMRC lacks a plan to deal with the threat of VAT losses due to online trading.
For the thirteenth time, the NAO gave a...