Chancellor Rachel Reeves is preparing to announce a landmark whistleblower reward scheme that will pay informants a share of the taxes recovered from exposing large-scale fraud — a first for the UK.

According to the Financial Times, the initiative will be unveiled in the Autumn Budget later this month as part of the government’s wider “Close the Tax Gap” strategy. The scheme, modelled on the successful US system, would allow HMRC to pay tipsters up to 30 per cent of any money recouped from tax evasion cases based on their information.

The move represents a major shift in Britain’s approach to whistleblowing, which has traditionally relied on moral duty rather than financial incentive.

“The new incentive programme will target higher-value tax fraud and supercharge enforcement,” a Treasury source said.

The Treasury estimates that tax evasion cost the UK 5.5 billion in 2022–23, though MPs on the Public Accounts Committee have warned that figure could be “just the tip of the iceberg.”

Across the 2023–24 financial year, the government lost 47 billion in unpaid taxes, underscoring the scale of the problem Reeves is seeking to address.

HMRC has already ramped up enforcement activity, conducting 648 raids in the past year — a 42 per cent increase from 2021–22 — and paying out nearly 1 million to informants in 2023–24, up 92 per cent from the year before.

The UK’s new whistleblower system is closely inspired by the US Department of Justice’s False Claims Act and the Internal...

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