Ikea, the Swedish juggernaut which is as famous for its squeaky-clean image as for its hellish shopping experience, long ago sealed its masochistic pact with the British consumer to become the country's biggest home furnishings retailer.

But an explosive book, The Truth About Ikea, claims that far from offering British shoppers a bargain, at the height of its powers in the late 1990s Ikea betrayed its golden rule – that prices should be 10% lower than those of its rivals – and ruthlessly overcharged British shoppers to boost profits.

The author, Johan Stenebo, was a member of Ikea's inner circle for 20 years, even working as an executive assistant to its revered founder, Ingvar Kamprad. The exposé, published in English for the first time this week, comes as Ikea is trying to shake off its secretive reputation, publishing details of its finances and complex ownership structure. Its parent company is based in the Netherlands for what are thought to be tax purposes.

Stenebo claims Ikea's decision to milk UK consumers was a pragmatic one, taken when other markets were in trouble. "Ingvar would never show any joy over profits and definitely not super-profits, but it needs profit to survive and grow," he writes.

Ikea simply "exploited" UK consumers because to its bemusement the demand for its products was "insatiable". Its handful of stores could barely contain the thousands of shoppers clamouring to get their hands on a Billy bookcase for the first time.

"Since there was no competition, Ikea could demand any price it wanted," says Stenebo. "As a customer you could frequently go neither forward nor backward in the store aisles, but were forced further into the interior of the building like penned cattle."

Ikea has discounted Stenebo's book as "personal opinion" but has indirectly addressed some of its criticisms. "I was not here 15 years ago but there is a very clear direction now," says Ikea UK's chief, Martin Hansson. "We will achieve growth by continuing to lower our prices. Compared to this time last year, our prices are already 5% lower across our entire home furnishings range."

Competition caught up with Ikea at the start of the decade and Hansson says it has been investing in the chain, with new stores helping relieve the crush, as well as the launch of a website.

And the retailer has now introduced shortcuts in stores to enable shoppers – some of whom had resorted to setting off the fire alarm – to make a beeline for the toilets or fresh air, rather than retrace their steps through every department. "Convenience is important and the customer should be allowed to choose where he goes, not me," Hansson said.

Some of the criticism has stung. A recent "Inside Ikea" presentation spelled out that the retailer had made €2.5bn on nearly €22bn of sales last year. It also made the point that "40% of our top 200 managers are women and we have a great mix of nationalities".

But the figures also show how little tax Ikea paid during the year – just £326m, a rate of 13.1%, which even its finance director, Søren Hansen, admits in the accompanying statement is "unusually low".

Tax Research UK director Richard Murphy suggests a figure of 27% could be expected given the tax regimes in Ikea's most important markets, but adds: "It is not unusual for multinational companies to pay less than the headline rate of tax. But this is very low when you consider close to 80% of its sales are in Europe."

Ikea has also started to publish detailed social and environmental reports which list a gamut of projects with the likes of WWF, Greenpeace and Unicef. And the firm recently hired Steve Howard, from The Climate Group, a not-for-profit non-governmental organisation, to be its chief sustainability officer.

But Stenebo says the progress made is limited given the company has been involved with the Forest Stewardship Council since the mid-1990s, with "the key to Ikea's low prices [being] the supply of cheap raw materials".