Starbucks may face an inquiry into its British tax affairs after an MP called for an investigation into how the company could avoid paying tax on £1.2 billion sterling of sales since 2009.
A Reuters report said Starbucks had been telling investors its UK unit was highly profitable while telling the UK authorities it was lossmaking, and thereby not liable for tax.
MPs said this undermined public trust in the tax system.
Labour MP Margaret Hodge, Chair of the Public Accounts Committee, said the UK tax authority should look into Starbucks' affairs.
Hodge, who has the authority to instigate an inquiry, said the head of HMRC would be testifying to the PAC, which is tasked with ensuring value in government financial affairs, next month and that she expected questions about Starbucks to be raised.
There was no evidence that Starbucks had been engaged in any kind of wrongdoing. HMRC does not comment on individual taxpayers and rejected any challenge to its efficacy.
"We make sure that multinationals pay the right tax to the UK in accordance with UK tax law," it said in a statement.
Starbucks declined to say if it was considering any changes to its accounting practices but said it was "totally committed to the UK".
"Starbucks pays and will continue to pay our share of taxes in the UK to the letter of the law," Kris Engskov, Managing Director of Starbucks Coffee UK, said on the company's website.
He went on to note Starbucks' contribution to the UK economy as an employer and as a customer for farmers and cake makers.
Meanwhile, Starbucks has only paid €35,000 in taxes in Ireland since 2005, while paying €5.7m in royalty and licensing fees to its parent company, accounts filed by the US coffee chain's wholly-owned Irish subsidiary Ritea Ltd show.
Accounts filed by Ritea - owned by Dutch-based Starbucks Coffee Emea - record a loss every year it has been in operation in Ireland except for 2011, when the company recorded a €524,944 profit on which €34,980 in tax was paid
