HMRC has 'lost its nerve' over big companies, MPs warn Report highlights failure to get more from firms like Google and Amazon The amount of avoided tax increased by Â£1billion last year to Â£35billion Criticism: Margaret Hodge said HMRC 'has not clearly demonstrated it is on the side of the majority who pay their taxes in full' Tax officials are accused today of losing their nerve when making corporate giants pay up, hammering small companies instead. A report by MPs highlights the failure of HM Revenue and Customs to get more from firms such as Google and Amazon. Allowing American internet giants to get away with paying little or nothing in the UK is â€˜at odds with HMRCâ€™s stance on pursuing tax debt from small and medium-sized businessesâ€™, the report by the public accounts committee says. The amount of tax avoided by companies and individuals increased by Â£1billion last year to Â£35billion â€" and this does not even include massive avoidance by multinational firms, the MPs say. Launching the report, committee chairman Margaret Hodge said HMRC â€˜has not clearly demonstrated it is on the side of the majority who pay their taxes in fullâ€™. She added: â€˜It pursues tax owed by the smaller businesses but seems to lose its nerve when it comes to mounting prosecutions against multinational corporations.â€™ Despite hiring 2,500 extra tax inspectors, the amount HMRC brought in rose by just 0.3 per cent to Â£475.6billion last year. Accounting for factors such as inflation, however, this amounted to a fall in real terms compared with 2011-12. HMRCâ€™s vigorous pursuit of small companies was illustrated earlier this year by the naming and shaming of nine ordinary business people â€" including a hairdresser and a coach operator â€" as part of a crackdown. Yet multinational giants have got away with using complicated accounting practices to limit tax payments while raking in billions. Facebook paid no UK corporation tax at all despite making more than Â£200million from its UK operations while Google paid less than Â£12million despite sales here of Â£3billion Last year Google paid less than Â£12million in UK corporation tax despite sales here of Â£3billion. Facebook paid none at all despite making more than Â£200million from its UK operations. Amazon, which claims not to have a presence in Britain despite employing more than 15,000 people here, paid Â£2.4million in corporation tax while making sales of Â£4.3billion. The report says: â€˜HMRC has not prosecuted any major internet company despite huge differences in the value of UK sales reported in the US and in the UK, and allegations that sales had been recorded as being made offshore in order to reduce tax liabilities, despite the sales actually being made in the UK.â€™ The report also said HMRC had so far managed to collect only Â£440million of an expected Â£3.12billion in unpaid tax from UK holders of Swiss bank accounts. A packed Amazon warehouse in Swansea. The firm, which claims not to have a presence in Britain despite employing more than 15,000 people here, paid Â£2.4million in corporation tax while making sales of Â£4.3billion Murray Worthy, of campaign group War on Want, said the report â€˜is a damning indictment of this Governmentâ€™s failure to tackle tax dodging by some of the biggest and richest companies in the UKâ€™. He added: â€˜Words will not fund public services or tackle inequality â€" we need to see much more radical action to end the scourge of tax dodging.â€™ Shadow Treasury minister Shabana Mahmood said: â€˜This is a damning report on the failure of David Cameronâ€™s Government to tackle tax avoidance and evasion. At a time when ordinary people are facing a cost-of-living crisis and the deficit is high, this is inexcusable.â€™ HMRC said it â€˜strongly disputesâ€™ the reportâ€™s conclusions, adding: â€˜We have secured more than Â£50billion of additional tax from our compliance work since 2010, including Â£23billion from large businesses.â€™