British Business Secretary Vince Cable on Sunday urged authorities to clamp down on "completely unacceptable" corporate tax avoidance, but stressed any broad reforms needed to be international in nature.
Pressure is mounting on multinationals, notably Google and Starbucks, to justify the amount of tax they are paying in Britain amid accusations that the levels are far too low.
According to figures cited by Conservative MP Charlie Elphicke, Google paid only £3.4 million ($5.4 million, 4.2 million euros) in British corporation tax last year on revenues totalling about £2.5 billion, while Starbucks did not pay a penny on sales worth £400 million.
Cable called corporate tax avoidance "completely unacceptable", saying on a BBC programme that there were "appalling stories of abuse".
Starbucks has confirmed not paying any corporation taxes in Britain for the past three years owing to fees paid to its businesses in the Netherlands and Switzerland, including royalties for the use of its brand.
This resulted in the company posting a series of losses in Britain and not having to pay any corporation tax.
Cable insisted that "the best off in society have got to contribute more, and that includes companies".
"Starbucks claims they are actually making losses in the UK," he told the BBC programme.
"I don't know whether they are not but you would need some pretty intensive investigation by the Inland Revenue to establish what exactly is going on, whether their transfer prices and their royalties are being fiddled or not."
But the minister warned that "a combination of action at the international level" was needed to prevent companies simply moving to more tax-friendly countries.