Wednesday 7 December 2016

Google Ireland pays €47m in tax on sales of €22.6bn

Published 05/11/2016 | 02:30

Google's Dublin offices
Google's Dublin offices

Google Ireland's latest accounts show that it paid €47m on sales of €22.6bn last year.

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The search giant, which books its European sales through its Irish office for tax reasons, declared a profit of €294m on the €22.6bn in revenue.

Its gross profit on €22.6bn in sales was €17.1bn.

However, it recorded €16.9bn as "administrative expenses", paid to other parts of its global organisation as part of a legal tax avoidance scheme.

The tech company's headcount at its Dublin office rose to 6,000, including almost 3,000 staff and 3,000 contractors.

The vast majority of staff (1,972) are in sales and marketing, with 397 in engineering and operations and 455 in administration and other activities. However, the company's investment in "research, development and engineering" rose from €73.9m to €111.1m here last year.

The company's wage bill rose marginally to €259m, although the average Google Ireland salary fell slightly to €91,676 compared to €94,591 in 2014. However, share-based payments rose sharply from €49.9m to €70.3m last year.

The company said that its cost of sales increased from €4.7bn in 2014 to €5.5bn in 2015 due to increased traffic acquisition costs, including fees paid to partners who direct search queries to Google's websites.

Ronan Harris, vice president and outgoing site head in Ireland said that the continued global expansion of the company's products, its advertiser and user base, as well as an increase in the number of Google Network Members had contributed to the company's overall growth in Ireland.

"Our operations in Dublin are contributing to our global success through our work with advertisers, publishers and users across EMEA," he said.

"Dublin is recognised as a key driver of growth among our customers and we are constantly innovating to help them grow stronger and better businesses."

Mr Harris was recently appointed as the new managing director for Google in the UK and Ireland and will now move to London. He has been succeeded as head of site at Google's Dublin-based office facility by Fionnuala Meehan, a vice president in Google with responsibility for marketing solutions in Europe, the Middle East and Africa.

"As Google grows, Ireland continues to benefit," said Mr Harris. "In 2015 we opened our second data centre, bringing total investment in capital assets in Ireland to over €750m."

Google's Irish accounts were published after the company formally rejected European Union antitrust charges of unfairly promoting its shopping service and blocking rivals in online search advertising, paving the way for EU regulators to rule next year on these issues and potentially impose hefty fines.

Google's rebuttal in the shopping case comes six years after the European Commission opened an investigation prompted by complaints from rivals such as Microsoft and a host of European and US rivals.

The EU regulator followed up with an anti-competitive charge against the company in April last year and added more evidence in July this year.

It also issued a separate charge sheet against its online search advertising product AdSense for Search at the same time.

Google's general counsel Kent Walker said on a blog that the accusations had no factual, legal or economic basis, and that the company's actions were driven by its users rather than any plan to squash rivals.

"We never compromised the quality or relevance of the information we displayed. On the contrary, we improved it. That isn't 'favouring', that's listening to our customers," Mr Walker said.

Irish Independent

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