CICTAR Blog: Palantir’s quarterly results show that things just got worse

Palantir’s latest results reveal escalating profit extraction and erosion of public services

CICTAR’s recent report on Palantir

Governments around the world continue to shovel public funds to Palantir despite the growing concerns about the company. Public service cuts are escalating poverty, and national debts reaching unprecedented levels. Meanwhile Palantir is boasting about its extraordinary profits. Profits which it appears to be shifting  from other countries back to the US while paying no US federal corporate income tax. Palantir’s income tax payments globally and in US states are barely noticeable while it profits from the taxes paid by the rest of us. All the while allegedly supporting genocide, helping to hunt immigrants and supporting the expansion of the surveillance state.

Recent news coverage has highlighted Palantir's 93% year-on-year growth in revenue, but its growth in profits has been even more astonishing. In the three months to June 2026, Palantir’s pre-tax profit hit $1.081 billion off $1.935 billion in revenue, a 55% profit margin.

Yet Palantir reported an income tax expense for the quarter of just $15.4 million, or 1.4%.

This is the same rate as Palantir for its corporate tax expense across the whole year in 2025, outlined by CICTAR in a recent report. This ridiculously low tax rate is the result of a tightly engineering global corporate structure that shifts revenue from across the globe into the US, now acting as a tax haven for Palantir. Smaller competitors can’t achieve these rates and are shut out of the market and government contracts.

Palantir appears to be using unrealistically low intra-group service fees, to shift profits from the UK and other countries across Europe back to the US.  It defies common sense that 26 percent of Palantir's revenue in 2025 came from outside the US, but 96 percent of pre-tax profit was booked in the US. And it seems unlikely to be coincidence that, having shifted profits back to the US, Palantir enjoys a ‘tax umbrella’ due to extensive tax breaks created by its carefully engineered corporate structure and further Trump administration corporate tax cuts.  This umbrella results in Palantir paying zero federal income tax on its shifted profits.  To add insult to injury, Palantir will not be paying any federal income tax in the US for many years to come.

But the result of these manoeuvres is not just that Palantir pays a minimal amount of tax in the US. The shifting of profits means that it also minimises its tax bill in countries such as the UK. Despite being heavily reliant on UK taxpayer money. And we see a similar story in other countries across the globe where Palantir is working to increase its presence. The more government contracts for Palantir, the less money available for health, education and other essential public services.

So what can be done?

The most obvious first step is for all governments to take control of the situation unilaterally and revaluate contacts with Palantir, cancelling them where possible, and becoming far more transparent where cancellation is not an option. Then to avoid any future contracts with the highly controversial corporation.  Where it is not already happening, thorough auditing of Palantir’s national level subsidiaries can be carried out. Tax authorities need to be provided with resources to do this.

However, while Palantir stands out as a particular case, and a clear demonstration of the difficulty that countries are having with taxing highly profitable, US based big tech corporations, it is not, by any means, the largest US big tech tax dodger globally. Wider solutions are needed.

The UK is Palantir’s largest market outside the US and there was a brief moment (in 2024) when the UK was able to use the OECD global minimum tax regime to at least tax Palantir a little bit more. Now, even that option has been given away, with the capitulation to Trump’s insistence that US corporations should be exempted from the global rules (the ‘side by side’ deal). One step could be for the UK, and other governments, to revisit and reinstate this option, or find other ways to achieve the same outcome. Digital services taxes (DSTs), which cover revenue from software and IT services, as in the US state of Maryland, should also be considered or revisited and could be brought into force at the by states and/or regional bodies.  This will require a united front, and some resolute resistance to bullying from the US.

Another route is for governments and regional bodies, such as the EU, to give procurement rules more teeth. Public authorities, at all levels of government, should be able to exclude corporations that shift profits from receiving any further public sector contracts. Our briefing from January 2026, developed in partnership with the European Federation of Public Service Unions (EPSU) lays out the basis for such a change in more detail.

Greater transparency for companies such as Palantir can be obtained through implementation of full, public, country by country reporting (pCbCR). Versions of this will be coming into force soon in the EU and in Australia and should provide very useful information on what these global corporations are up to in terms of tax dodging. Recent pCbCR reports filed in Ireland by Microsoft and Apple have been revealing and many more are on the way. Even in the US, greater reporting requirements for tax transparency have helped expose profit shifting schemes by Palantir and many other US corporations.

Further multinational tax transparency requirements are needed. The bitter and desperate opposition to greater transparency by multinational tax dodgers and corporate lobbyists is a clear indication of their effectiveness. The UK stands out as a place where a robust pCbCR regime could be brought into immediate force by the government without need for further legislation.  

Finally, while the OECD has been able to obtain some useful steps in terms of global tax reform it has failed to address the core problems, leaving corporations such as Palantir a free rein to continue with the type of tax dodging outlined by CICTAR. It is time to shift reform to the ongoing development of a United Nations Framework Convention on International Tax Cooperation and to develop genuine and effective alternatives to the current system. Specifically, we need to see a move to a tax system which drops the fiction of subsidiaries of global corporations being treated as a series of separate entities trading with each other in a ‘free market’.

Ultimately, the world must move towards a system where corporations are treated as single, unitary, entities, where taxation is based on an analysis of global profits and tax revenues are distributed based on a clear and transparent formula measuring where profits are genuinely earned rather than artificially shifted. This is not a far-fetched idea, already more than half of all US states have a corporate income tax system which does this. However, since the Reagan-Thatcher years a state-level loophole has been added allowing corporations to exclude offshore profits from the formula used to calculate the corporate income tax owed. US states could end this loophole and this model could be modified and adopted in other jurisdictions.