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How we make sure the tax gap estimate is reliable.

Published 30 October 2023

We sought feedback and advice from external experts on the appropriateness and robustness of our new estimation method based on a multi-stage regression approach. Poisson Pseudo Maximum Likelihood (PPML) regression better fits the data and enables us to use a richer dataset, improving the reliability of the estimates. They have supported our revised reliability rating of high with a score of 21.

Figure 3: Reliability rating scale from very low to very high – WET gap

"Figure 3: This image is a graph that represents the reliability rating for the current wine equalisation tax gap estimate. The rating scale includes:
-          Very low which is a score between 0 and 10
-          Low which is a score between 11 and 15
-          Medium which is a score between 16 and 20
-          High which is a score between 21 and 25
-          Very high which is a score between 26 and 30.
The graph shows the WET gap estimate has a rating of 21 which is high."