THE government needs to “get its house in order” when it comes to tax collection, according to Bolton Council chiefs.

The move follows comments from the Conservative-led Local Government Association (LGA), the organisation that represents councils, which claimed the government could pull in an extra £20 billion a year if it improved the way it collects taxes.

The LGA said the government was losing money through a combination of tax evasion and avoidance, non-payment and errors.

It said councils had collected more than 97 per cent of the council tax and business rates due to them last year.

But HM Revenue and Customs rejected the claims, claiming the LGA had “not properly understood” the issue of taxation. Bolton Council has seen its funding slashed since 2010 as part of Government austerity measures.

Council leader Cllr Cliff Morris said: “I agree with the LGA. They should get their house in order because if they don’t do it we will be penalised through their inefficiencies with the tax collection, so this would help.”

Cllr David Greenhalgh, leader of Bolton’s Conservative Group, added: “I agree. If the government is asking local government to make efficiencies then it should be seen to be leading from the front.”

An HM Revenue and Customs spokesman said: “The LGA have fundamentally misunderstood the nature of the tax gap, which is not a measure of tax unpaid.

“In fact, HMRC already collects 99 per cent of all taxes and duties that are collectible from a very wide customer base of 60 million taxpayers, increasing our tax take by £1.4 billion to £475.6 billion in the last year alone.

“On average, we collect £1.3 billion a day for the UK.”