The Inland Revenue should be given more powers to pursue unpaid taxes, a committee of MPs has said.

A report from the Commons public accounts committee today warns that over £3 billion of unpaid taxes are overdue by a year or more.

While much will be collected, some £700 million is written off each year.

"These are large sums to be tied up at any one time, or lost to the public purse altogether, when they could be paying for public services," said committee chairman Edward Leigh.

The Revenue should impose a surcharge on persistent late-payers, say the MPs.

And powers should be given to the tax collecting agency to ensure that companies which are going insolvent pay their equivalent of pay-as-you-earn tax into a separate bank account.