Google bosses in California are expected to reveal global revenues grew by more than 11% to about $72bn (£50bn) last year – with more than £5bn believed to have come from sales to UK customers.
Alphabet Inc, the search group’s parent, is expected to confirm on Monday about one in 10 dollars earned last year by Google came from UK advertisers, despite the dollar strengthening against the pound.
A jump in the group’s UK sales – up from £4.54bn for 2014 – is likely to add to widespread anger at the group’s controversial tax structure, which ensures the revenue from British customers is booked in Ireland.
Much of the income arriving in Ireland is then squeezed through another Google company in the Netherlands before bouncing back to Ireland and Bermuda, a UK overseas territory and tax haven.
George Osborne had promised to stop multinationals diverting UK sales and profits overseas, but Google this month announced it had struck a deal with HMRC to continue the controversial arrangement.
Google’s UK business paid tax of just £21m for 2013. The British company’s soon-to-be-published latest accounts – for the 18 months to June 2015 – show it has agreed to pay back taxes and interest of £130m covering underpayments stretching back a decade.
Back in California, Alphabet is also expected to reveal on Monday that Google’s cash reserves, parked offshore, swelled by $4bn in 2015 to $43bn. Google will say in its annual report that this money is after-tax profits from its non-US markets, of which the UK accounts for 17% .
Last October, Google bosses showed Wall Street analysts how the group had generated about $5.37bn (£3.7bn) from the UK in just the first nine months of 2015.
They added that for July, August and September alone, the group UK revenues would have shown growth of 18% but for the fact that the pound weakened against the dollar.
Financial analysts at RBC Capital Markets have forecast Alphabet will report total revenue for 2015 of $74.5bn. Those at Morningstar estimate last year’s revenues could be as much as $75.4bn.
This article was written by Simon Bowers, for theguardian.com on Monday 1st February 2016 15.01 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010