"In 2024-25, HMRC spent £1.16 billion on IT and telecoms while collecting £858.9 billion in tax. In June's Spending Review, the government said departments would perform a Zero-Based Review (ZBR) of budgets, taking a "digital-first approach" and involving chief digital and information officers. The result was that HMRC received an additional £1.6 billion from 2026-27 to 2028-29 to "modernize and reform HMRC's IT and data infrastructure", the NAO said."
"HMRC was also allocated funding of £300 million from the government's Transformation Fund to improve customer services and IT by using "digitalization and artificial intelligence (AI) capability to drive productivity improvements". But the new investment comes with a catch. With it, the government expects HMRC to create efficiencies worth £886 million by 2028-29, giving the tax collector higher gross efficiency targets than any other central government department, at 15 percent against its planned spending, the NAO said."
HMRC spent £1.16 billion on IT and telecoms in 2024-25 while collecting £858.9 billion in tax. Departments will perform a Zero-Based Review of budgets with a digital-first approach, and HMRC received an additional £1.6 billion for 2026-27 to 2028-29 to modernize and reform its IT and data infrastructure. HMRC also received £300 million from the Transformation Fund to improve customer services and deploy digitalization and AI to drive productivity. The government expects HMRC to deliver £886 million of efficiencies by 2028-29, a 15% gross efficiency target. The National Audit Office found HMRC is taking longer to move off legacy systems, facing higher costs, and has not yet achieved anticipated efficiencies from digital services.
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