Google Ireland, the Irish subsidiary of the dominant internet search and advertising company, had revenues of €3.343 billion in 2006 and reported a pre-tax profit of €17.36 million.

Accounts just filed with the Companies Registration Office show revenues more than doubled from the 2005 level of €1.662 billion.

Google attributed the increase in turnover to a significant increase in new contracts, a rapid growth in the online advertising market, and its continued emphasis on the European market. Despite the growth in sales and profits, the Irish operation's tax bill was broadly flat at €3.72 million, up from €3.45 million in 2005. Google Ireland has retained profits of €28.4 million.

Google had been criticised in the US for declaring profits in the Republic where the corporation tax rate is 12.5 per cent - significantly lower than in the US.

Last year it entered into an agreement with the US tax authorities to limit the amount of profit routed through the Republic. Last night a spokesman for Google said: "Google Ireland operates in accordance with Irish law, complies with good corporate governance and all applicable tax rules."

The web giant has continued to expand the number of free services it offers in order to generate traffic to its sites. Its primary source of income is selling online advertising, both on its own sites and on behalf of thousands of third parties - which it refers to as the Google network.

The accounts underline the high costs the company faces in distributing its advertising.

The cost of sales, primarily related to revenue sharing with Google network members and other partners, rose from €549 million to €1.12 billion.

Administrative expenses also increased significantly from €1.11 billion to €2.21 billion. The company attributed this to increased staffing levels, expansion of sales and marketing activity in Europe, the Middle East and Africa (EMEA) and increased royalty payments related to increased turnover.

Google employed an average of 675 staff in Dublin last year, the vast majority of whom were employed in sales of advertising into markets in EMEA. Staff numbers in Ireland are now understood to be about 1,500.

Last year, the staff received salaries, pension contributions and share-based payments of €4.22 million, or an average of €62,481 each.

The accounts also note that "no significant research and development was carried out during the year".

The directors of Google Ireland recommended that the company did not pay any dividend.

Google Ireland is a wholly- owned subsidiary of Google Ireland Holdings, an unlimited company which due to its status does not have to report financial information.

The ultimate parent is the Nasdaq-quoted Google Inc.