Key facts
- Palantir paid £2.1 million in UK corporation tax in 2024 on £247 million in declared UK revenues.
- A report by CICTAR claims Palantir shifts European profits to the U.S. to minimize tax obligations.
- Palantir's global effective tax rate was 1.4%, and it paid no U.S. federal taxes in the past year.
- CEO Alex Karp projects worldwide revenues to nearly double to $8 billion this year.
- Palantir states that transfer pricing is a standard practice and it complies with local tax laws.
Palantir paid just £2 million in UK corporation tax in 2024, despite declaring £247 million in revenues and holding lucrative public sector contracts, according to a report by the Centre for International Corporate Tax Accountability and Research (CICTAR).
The report, commissioned by the trade union Unison, alleges that Palantir is shifting profits from its European operations to the U.S. parent company to take advantage of tax shelters, thereby minimizing its tax obligations in Europe.
Researchers found that Palantir's global effective tax rate was approximately 1.4%, and the company paid no federal taxes in the U.S. last year, only over $2.5 million in state taxes. The UK's corporation tax rate was 25% in 2024, yet Palantir's effective rate on its UK profits was just over 8%.
Palantir's CEO, Alex Karp, projected that worldwide revenues would nearly double this year to $8 billion, a forecast that contributed to a 17% bounce in the company's shares. The UK is Palantir's largest market outside the U.S., with about 750 employees based there and an estimated £670 million in government contracts by 2026.
A spokesperson for Palantir defended the company's practices, stating that transfer pricing is a standard and virtually universal method for large multinational corporations. They asserted that accounting practices can lead to different filings in various countries and that it is common for U.S. parent companies to record revenues earned abroad. The spokesperson also noted that the use of share options for staff, which reduces corporate tax liability, is a standard measure designed to give employees a stake in the business.
The report also highlighted that Palantir has accumulated billions in U.S. tax credits from share options and prior losses, potentially shielding it from U.S. federal income tax for nearly a decade. Furthermore, the company has benefited from tax cuts implemented by Donald Trump, which reduced the corporate tax rate from 35% to 21%.