Microsoft paid £34 million in Irish corporation tax last year, indicating pre-tax profits of £340 million.

According to a note prepared in May by IDA Ireland and released following a Freedom of Information request, the company expects to pay £41 million in corporation tax this year, and £46 million in 1999.

The Republic is Microsoft's manufacturing, distribution, logistics and European data centre for 25 European subsidiaries as well as for markets in Africa, the Mediterranean and the Middle East. The company sources 98 per cent of its raw materials and services in here, involving expenditure in the economy of more than £150 million per year.

In May, it employed 1,195 people, 395 of whom were temporary. The average age of the employees was 30 years, 72 per cent had third level education, 75 per cent were Irish, and 60 per cent were male.

Microsoft's operating system is estimated to be installed on 85 per cent of the 300 million personal computers world-wide. Its European operations, headquartered in Sandyford, County Dublin, account for 30 per cent of total sales, according to the IDA note.