The government has been warned that it must do more to tackle the non-payment of taxes.

In a report published on Wednesday the National Audit Office (NAO) found that the total debts currently unclaimed amounts to £14 billion.

Of that over £3 billion of debt is over a year old, the watchdog finds.

"The Inland Revenue have improved the way they recover debts in recent years but they could make further improvements to reduce debts owed by taxpayers," found the NAO.

The finance watchdog said that the Inland Revenue is operating systems which amount to the "best used by other tax authorities".

"The department recognises that they could make better use of the telephone centre by routing more types of debt through it," said the NAO.

"Debts totalling £3 billion are currently handled by more expensive methods. The report also recommends wider use of past payment records and scoring techniques to help identify and advise those that might get into debt and to design the best method of recovery."

Better information

It concluded that better information "would help the department manage debt recovery more effectively".

Said NAO chief Sir John Bourn: "Much tax is collected quickly but at any one time there are billions of pounds outstanding, some of it long overdue.

"Faster recovery and preventing the build up of debt could bring in money which could be used to improve public services. My report identifies further opportunities for the Inland Revenue to improve how they collect debts."

Opposition parties, however, said the government must act quickly to deal with the debts.

"It is time that the Inland Revenue cracked down on its debts," said the Liberal Democrat spokesman Vince Cable.

"With billions of pounds of debt left outstanding for more than a year there is clearly a lot of room for improvement."