HMRC has been blasted for failing to get tough on criminal gangs committing alcohol duty fraud that deprives the Treasury of over £1bn a year.

MPs on the Public Accounts Committee (PAC) claimed HMRC appeared to be reluctant to prosecute offenders after they found 20 successful cases - or just six a year - had been brought over the four years from 2006/07 to 2009/10.

While HMRC has estimated the tax gap between the amount of alcohol duty due and the amount collected at around £1.2bn, PAC members slammed the department for failing to assess the tax gap for wine despite previously vowing to do so.

The MPs said HMRC did not take enough account of the deterrent effect of successful prosecutions when considering the cost and benefits of pursuing perpetrators through the courts.

The committee said the department had failed to garner enough sound information about how effective it was at tackling the problem and hadn't made the best use of intelligence and technology to detect and stamp out evasion.

MPs were told how gangs often export duty unpaid alcohol before redirecting it back to the UK to sell.

PAC MP Richard Bacon said: 'HMRC's drive to tackle alcohol duty evasion is being seriously hampered by a lack of information.

'The department does not have enough reliable information on the returns from tackling different types of alcohol duty evasion. It cannot say, therefore, whether a more effective targeting of its resources might not secure a better return on its investment.

'It is unacceptable that the department has still to produce an estimate of the tax gap for wine, despite a commitment to this committee's predecessors to do so. The absence of information on the scale and nature of wine duty fraud undermines the basis on which the department directs its resources to tackling the problem.

'Since the criminal gangs who perpetrate major alcohol duty fraud operate across national boundaries, the department needs to strengthen its intelligence by developing better links with the industry, the UK Border Force and other EU member states.'

HMRC chief executive Lin Homer said: 'HMRC welcomes the PAC report on alcohol fraud and is considering the findings. Tackling alcohol fraud is a priority for HMRC and our strategy increased the impact we have on fraud by over 50% in its first full year of operation. We continue to build on this strategy, with additional staff being deployed as part of the government's 2010 Spending Review and by exploring new legislative measures and enforcement options.'