Palantir Technologies, the U.S.-based data analytics and artificial intelligence company, has been accused of “restructuring” to avoid paying U.S. federal corporate income tax, according to a new report from the Center for International Corporate Tax Accountability and Research (CICTAR).
The report comes as Palantir posted second-quarter revenue of $1.94 billion, up 93% year-over-year, driven largely by government contracts. However, the company’s global effective tax rate was just 1.4% in 2025, according to CICTAR.
Details on Palantir’s Tax Arrangements
According to the report, Palantir shifted profits from contracts in the UK and Europe to its U.S. parent company, leaving little taxable profit where the work was actually performed. In the UK, the company recorded only about £2 million ($2.7 million) in corporate tax for 2024, despite signing government contracts worth more than £670 million ($900 million) in recent years.
CICTAR also noted that Palantir did not pay U.S. federal corporate income tax in 2025—the third consecutive year—and paid only $2.5 million in state taxes. The company has accumulated over $3.5 billion in deferred tax assets from prior losses, research and development credits, and deductions related to employee stock. CICTAR estimates these could shield up to $16.5 billion of Palantir’s future profits.
Palantir also benefited from the reduction in the federal corporate tax rate from 35% to 21% under President Donald Trump in 2017.
Palantir’s Response
The report does not allege that Palantir’s arrangements are illegal, but raises ethical questions about a company receiving billions in public contracts contributing so little in taxes. A Palantir spokesperson said the company complies with all tax regulations and that transfer pricing is standard practice for multinational corporations.
Background and Controversies
Palantir was founded in 2003 by CEO Alex Karp and billionaire Peter Thiel, with backing from In-Q-Tel, the CIA’s venture capital arm. The company’s market value is around $370 billion, placing it among the 50 largest publicly listed companies in the world.
The company faces controversy for providing technology to U.S. Immigration and Customs Enforcement (ICE) and the Israeli military. CICTAR said Palantir’s technology allows ICE and the Department of Homeland Security to “combine vast datasets” without transparency, raising privacy and surveillance concerns.
Some organizations, including Amnesty International, have called on the UK government to review its contracts with Palantir, particularly the £330 million deal with the National Health Service (NHS), arguing the company could be complicit in violations of international law in Gaza.
