Tax avoidance by multinational companies has been roundly ignored while the government pursues small businesses and individuals, a committee of MPs claimed yesterday.

A report published by the public accounts committee (PAC) criticised the government's lack of action over tackling "aggressive" tax avoidance and chasing down multinationals.

HM Revenue and Customs (HMRC) brought in £475.6 billion in revenue for the government in 2012/13 - an increase of £1.4bn or 0.3 per cent in cash terms over the previous year, the report found.

But tax income actually fell in real terms after inflation was taken into account, the PAC said, while the "tax gap" between the amount owed to the Exchequer and the amount actually collected grew by £1bn to £35bn in 2011/12.

Launching the report, committee chairwoman Margaret Hodge said: "In pursuing unpaid tax, HMRC has not clearly demonstrated that it is on the side of the majority of taxpayers who pay their taxes in full.

"Last year the department collected less tax in real terms than it managed to collect in 2011/12. This was despite the stated ambition to crack down on tax avoidance.

"The tax gap as defined by HMRC did not shrink, but in 2011/12 grew to £35bn. Yet that measure does not capture all the tax government should be collecting. For instance, this figure does not include all the tax revenue lost to aggressive tax avoidance schemes."

She said HMRC pursued tax owed by smaller firms and individuals but seemed to "lose its nerve" when it came to multinational corporations.

The Public and Commercial Services union (PCS) said the committee's findings confirmed what it had been saying for some time.

PCS general secretary Mark Serwotka said: "Ministers cannot credibly claim to be concerned about the billions lost through tax avoidance and continue to slash resources from the very department responsible for doing something about it."