Palantir Technologies CEO Alex Karp speaks during the World Economic Forum annual meeting in Davos, Switzerland on January 20, 2026. (Photo by Fabrice Coffrini/AFP via Getty Images)
“The likes of Palantir need to stump up what’s due,” said one expert. “Tech giants raking off billions in profit can’t be free to pay what they please.”
Palantir Technologies, one of the world’s most influential—and controversial—surveillance tech companies, enjoyed an effective tax rate of just 1.4% globally last year while paying no US federal income tax despite recording substantial profits, an analysis released on Wednesday revealed.
The study,Who Pays for the Surveillance State?, was written by the Center for International Corporate Tax Accountability and Research (CICTAR) in partnership with the European Federation of Public Services Unions. The report “examines how Palantir is capturing ever-larger government contracts while paying no US federal corporate income tax and shifting much of its foreign profits back to the US, avoiding taxes in Europe.”
“In 2025 the company reported $1.657 billion in pre-tax profit, booked $22.7 million [in] corporate tax paid globally, and paid $0 in US federal income tax, resulting in an effective tax rate of just 1.4% globally,” CICTAR found.
“The report’s core claim of profit-shifting is based on the gap between revenue and profit location: 26% of Palantir’s revenue came from outside the US, but 96% of pre-tax profit was booked in the US,” the analysis states.
“The Trump administration has not only been granting record amounts in new contracts to Palantir but is running a global protection racket to help it—along with larger US tech giants—avoid paying tax both in the US and globally,” the report contends.
“In Europe, the report finds a pattern of subsidiaries providing services to the US parent on cost-plus terms, leaving low taxable margins locally while related-party payments move value back to the US,” CICTAR added.
Palantir maintains that it complies with applicable tax laws in every jurisdiction where it operates. Company representatives have said that transfer pricing arrangements and other accounting practices cited by critics are standard among multinational corporations and comply with existing regulations.
The Palo Alto, California-based company’s soaring revenues are partly driven by government contracts, with the US Department of Defense being the data analytics specialist’s biggest client. Palantir is also integral to the Trump administration’s deadly anti-immigrant crackdown, selling technology used by Department of Homeland Security agencies—including Immigration and Customs Enforcement (ICE)—to identify, track, and target people for arrest and deportation and manage their cases.
Palantir has also drawn scrutiny from Democratic US lawmakers, including Sen. Ron Wyden of Oregon and New York Congresswoman Alexandria Ocasio-Cortez, who demanded answers following reporting last year that the company was “amassing troves of data on Americans to create a government-wide, searchable ‘mega-database’ containing the sensitive taxpayer data of American citizens.”
Palestine defenders have also denounced Palantir and other tech giants for selling technology to the Israeli government and military despite findings by rights groups, scholars, national governments, and a United Nations commission of inquiry that Israel is committing genocide in Gaza.
Alex Karp, the billionaire co-founder and CEO of Palantir, told CNBC last month: “I am the most publicly supportive CEO of Israel. I think Israel is on the side of good.”
In Europe, advocacy groups have raised concerns about Palantir’s contracts involving sensitive medical records, immigration systems, and predictive analytics. Campaigners argue that centralized data platforms create attractive targets for misuse, unauthorized access, or mission creep beyond their original purposes.
CICTAR’s report concludes that “European public authorities should be able to exclude companies that take public money while shifting profits away from the national tax base that funds public services, and provide the basis for national security that Palantir claims to defend.”
Responding to the report, Andrea Egan, general secretary of UNISON, the largest trade union in the United Kingdom, said that “a big multinational aggressively avoiding tax and dodging its responsibility to pay a fair share is probably no surprise. But the fact the UK and other countries are rewarding Palantir with massive government contracts is what beggars belief.”
“Systems that enable tax to be shirked on an industrial scale clearly have to change,” she added. “The likes of Palantir need to stump up what’s due. Tech giants raking off billions in profit can’t be free to pay what they please. Ministers shouldn’t award contracts to run public services to firms that are starving them of cash.”
Orcas discuss Donald Trump and the killer apes’ concept of democracy. Front Orca warns that Trump is crashing his country’s economy and that everything he does he does for the fantastically wealthy.Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.
Palantir’s UK CEO Louis Mosley says the company uses “a standard tax incentive” to minimise corporate tax. But the UK is one of the few countries that allows for this.
In May 2003, a standing committee of the House of Commons assembled to discuss and debate a mammoth Finance Bill.
“I am a tough chairman,” Nicholas Winterton, then a Conservative MP, declared at the first sitting, “and this will be an ordered, constructive and positive committee.” Mobile phones would be switched off, while members were permitted to remove their jackets at their discretion, provided they “are hung tidily on the rear of chairs.”
Stuffed into MPs’ red boxes that day was a provision that, over the next two decades, would allow Big Tech to reap billions of pounds in corporate tax deductions in the UK. Tony Blair’s government wanted to allow a company issuing stock to its employees as part of a compensation package to claim a tax relief equivalent to the difference between the market value of the stock and the original price an employee paid for it.
The committee approved the provision, and it was passed by Parliament. This week, Louis Mosley, the CEO of Palantir’s UK and European operations, referenced this debate to defend the controversial US tech firm’s minimal corporate tax payments in the UK as “a standard tax incentive under UK law”.
Mosley’s comments came after a report by the Centre for International Corporate Tax Accountability and Research confirmed openDemocracy’s findings that Palantir has used its share-based compensation scheme for UK employees to minimise its corporate tax obligations by millions of pounds. As we uncovered, the company paid less than £1m in corporation cash taxes in the UK last year – less than it paid in Korea, Japan, France and Germany, despite the UK being its second-largest market after the US.
The public conversation over Palantir’s tax minimisation cuts to the heart of the ongoing debate about capitalism in the UK: after a decade and a half of austerity, who should pay tax – and how much – to mend our unravelling social services and societal fabric? These questions are particularly acute in the case of Palantir, since much of the company’s profits in the UK are derived from government contracts paid for by ordinary taxpayers.
Palantir’s Mosley and former corporate tax lawyer Dan Neidle have argued that, while on paper, it could look like the corporation is avoiding tax, HMRC recoups the money via the income taxes paid by Palantir’s highly remunerated employees.
“We run a generous share scheme for our UK employees. Those shares have risen sharply in value (because of our profitability). So then has the tax bill on those shares – paid at income tax rates, which are HIGHER than corporation tax rates. UK law then offsets some of that against corporation tax, exactly as Parliament intended,” wrote Mosley on LinkedIn, claiming that the company paid $148 million in UK taxes.
“The net result of this sneaky wheeze? More tax paid by Palantir to the Treasury, not less.”
Mosley’s claims cannot be independently verified as the company’s 2025 accounts have not been published on Companies House.
“I don’t see this as tax avoidance, legally or morally,” Neidle, the founder of tax advisory nonprofit Tax Policy Associates, previously told openDemocracy. “[Palantir’s] employees in the UK will have been subject to income tax and employee/employer national insurance. So overall it likely resulted in additional tax being paid.”
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A look at the 2003 tax amendments by the then Labour government, and interviews with tax experts based in other countries, reveal that the UK and the US are outliers in their generous approach to taxing corporations, despite the UK’s headline 25% corporation tax.
The decision to tax employees, while granting corporations deductions, is a clear political and regulatory choice, these experts said, based on the nature of economic activity a given tax regime incentivises — in this case finance capital and Big Tech. Or more bluntly, just because a particular tax provision exists, experts said, it doesn’t mean it is justified.
“Even though this kind of huge deduction may be technically justifiable in a system of taxation, “it’s more the question of, ‘Is this fair?’” said Christoph Spengel, professor for international taxation at the University of Mannheim in Germany – a country that doesn’t allow this type of wide deduction.
“What are the observable consequences if wealth is concentrated in the hands of only a few individuals? Because that’s what this means,” he said.
Spengel said he couldn’t see the justification for such a provision, “because actually there is no cost” to the corporation: no wealth has left the company and it has not given up any of its assets. An employee’s income tax and other personal tax obligations should have no bearing on whether a company gets a deduction, he added.
“Corporations are really important players in the economy, and you want to have a tool to incentivise them to do things you like and stop them from doing things you don’t like,” said Reuven Avi-Yonah, Irwin I. Cohn professor of tax law at the University of Michigan whose work focuses on corporate and international taxation. “And the corporation tax is a very versatile instrument with which to do this.”
“A lot of people are worried about two things: the concentration of wealth in very few hands and AI,” said Kimberly Clausing, Eric M. Zolt Chair in Tax Law and Policy at the UCLA School of Law. Clausing said that while economists and policymakers are considering a wide array of novel solutions to this problem, “the same objectives could be reached much more easily if we had the will to use our corporation tax properly.”
Neidle, from Tax Policy Associates, disagreed.
“Whilst it’s true that the UK and US are outliers in a formalistic sense, in reality people achieve the same thing in most of the world. That is both reasonable and hard to stop, given that a share scheme is economically equivalent to a bonus plus a share purchase,” he said.
In Neidle’s opinion, a company giving its employees a cash bonus to buy shares was “economically identical” to just giving the employees the shares.
“It’s generally a bad idea to create different tax results from identical economic cases, and if you do (as Germany has) then it’s trivial to get round it,” he said. “The result is the same – it’s just more complicated.”
Blair-era break
At the turn of the millennium, companies in the US – particularly in the then-nascent tech sector – were increasingly compensating employees with stock instead of higher salaries. For the firms, the benefits were threefold: they retained cash that could be invested in the business, held onto employees until their shares vested, and saved on tax.
The UK government responded by taking a leaf out of the US’s playbook to amend its own corporation tax rules. When the change was passed in the early 2000s, the Treasury estimated that by 2007-08, it would lose around £95m in forgone taxes in that year, according to a reply to a Parliamentary question in 2003.
Two decades later, as openDemocracy reported, Palantir alone was able to legally use this deduction to create a tax deduction worth around £230m in 2022 – a figure the company has not contested.
“This is the main reason why US mega-corporations don’t pay any tax, because they all issue huge amounts of share-based compensation and deduct it,” Avi-Yonah told openDemocracy. “This has been true forever, it’s not a recent trend. What’s a recent trend is their incredible profitability because of AI.”
Blair-era MPs may have been unable to foresee the staggering shares-based wealth that Big Tech’s IPOs would create over the next two decades, but it is worth noting that not all countries treat corporate taxes the way the US and the UK do.
“The corporation tax deduction available in the UK is among the more generous. Stock-based compensation is supposed to reduce payroll pressure on cash flow, especially for start-ups,” Mike Lewis, the director of Tax Watch, told openDemocracy previously. “The fact that it is also available to established, profit-making companies means that it can effectively wipe out very profitable companies’ tax bills for years if share values significantly increase.”
Neidle said he was concerned that the current debate around deductions for share-based compensation was being shaped by opinions about Palantir, rather than concerns about tax policy.
“People here are starting with the conclusion they want: corporations are bad, Palantir is particularly bad. Then forcing a share scheme argument into it. It is not principled, and it’s not good policy,” he said.
Tax and Regulation
While tax laws are usually presented as a pragmatic set of rules and numbers, they are subjective and the result of policy debates, corporate lobbying and political compulsion.
For instance, corporate income tax in the early 1900s in the US is the outcome of two struggles, writes Marjorie E. Kornhauser, professor of law emerita at Tulane University: “The attempt to enact an income tax and the struggle to regulate corporations.”
As the nature of corporations has changed over the centuries, so have the arguments around how and why they should be taxed.
Corporations today are structured very differently compared to previous eras. Research conducted in the USsuggests companies are increasingly substituting wages with share-based payments.
Further, tech firms (including Palantir) increasingly rely on dual-class stock, which allows vast amounts of stock to be issued to employees without their founders worrying about losing control of their companies. Founders are therefore rewarded with unprecedented control of their businesses and greater voting rights than ordinary shareholders. When Google debuted a dual-class structure in its IPO in 2004, only about 1% of US listed companies used such a structure. By 2018, that figure had risen to 30%.
Another structural shift is the growing trend of tech companies earning a growing share of their revenue from public contracts, as governments around the world look to digitise and modernise. Palantir, for instance, earns a majority of its revenue in the US and UK from government contracts paid from public funds.
“Ultimately it’s the taxpayers who fund the money that goes to Palantir,” said Avi-Yonah. The current arrangement is a “one-sided thing where they just grab the money and don’t pay any tax, and don’t give anything back,” except its services, he said.
openDemocracy has reached out to Palantir for comment and will update the piece when they respond.
This article was updated on 8 August 2026 to include comments from Dan Neidle.
Orcas discuss Donald Trump and the killer apes’ concept of democracy. Front Orca warns that Trump is crashing his country’s economy and that everything he does he does for the fantastically wealthy.Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.
Donald Trump urges you to be a Climate Science denier like him. He says that he makes millions and millions for destroying the planet, Burn, Baby, Burn and Flood, Baby, Flood.Nigel Farage urges you to ignore facts and reality and be a climate science denier like him and his Deputy Richard Tice. He says that Reform UK has received £Millions and £Millions from the fossil fuel industry to promote climate denial and destroy the planet.Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.
A protestor holds a ‘Polluters Pay Up’ sign outside the Phillips 66 Los Angeles Refinery Wilmington Plant on November 28, 2022 in Wilmington, California. (Photo by Mario Tama/Getty Images)
“If this is a genuine change of heart from a president whose budget bill included $18 billion in taxpayer handouts to Big Oil, we welcome it,” said one organizer. “But talk is cheap, here’s the real test.”
After President Donald Trump echoed climate campaigners’ longtime condemnation of fossil fuel giants’ massive profits—uttering “the only thing” the climate-denying president “has said about energy policy since taking office that makes any sense,” according to one advocate, organizers on Tuesday urged him to put his money where his mouth is by backing a windfall profits tax for companies like Chevron and Exxon Mobil.
In the Oval Office on Monday, Trump called on those corporations and others to slash prices and give some of their record-breaking profits—specifically those made since the president joined Israel in waging an unprovoked war against Iran on Feb. 28—“back to the public.”
“They’re making too much money, based on a shortage,” said Trump, while noting that he is a “big free enterprise guy.”
“I don’t like it… Chevron, too much money. Exxon Mobil, too much money,” he said. “When you look at one company, they made 12 times what they made the year before? Give some of that back to the public, and they’d better cut the retail price.”
“Too much money.”
“Chevron too much money.”
“Exxon Mobil too much money.”
President Donald Trump attacked oil majors ExxonMobil and Chevron for earning windfall profits from energy shortages created by the U.S.-Iran war, demanding that both companies cut prices and return… pic.twitter.com/I3CfmmQlqv
With oil and consumer gas prices skyrocketing since Trump and Israel started the war, resulting in Iran’s retaliatory measure of effectively closing the Strait of Hormuz, which a fifth of the world’s oil supply ordinarily travels through, Exxon reported that its second-quarter profits more than doubled compared with last year. The company took in $14.5 billion, while Chevron reported profits of $12 billion compared with $2.5 billion in 2025—nearly a 400% increase.
BP also reported profits that were $2.35 billion higher than last year.
An analysis by the Guardian published Tuesday showed that eight of the world’s largest oil companies made nearly $93 billion in profits in the three months following the invasion.
Chevron just announced its highest quarterly earnings ever. Shell clocked its second-highest quarterly profits. ExxonMobil doubled its earnings.Combined, the three companies raked in, on average, some $404 million in profits every day for the last three months.
The climate action group 350.orgnoted that the record profits of oil and gas giants come as “communities across the world endure record-breaking heatwaves, wildfires, and rising living costs”—and as governments from around the world prepare to resume negotiations on a United Nations Framework Convention on International Tax Cooperation, where a “mandatory surtax on highly polluting industries is gaining support as part of that process.”
“From Bordeaux to Phoenix to Mumbai, families are living through the cost of climate delay, while the companies most responsible bank blockbuster bonanzas,” said Anna Jellema, executive director of 350.org. “That is not a coincidence; it is a business model. Governments meeting in New York this month have a genuine opportunity to change it. Calls are growing across the political spectrum for a proper global profits tax, so the industry that helped cause these disasters pays towards the recovery, the solutions and the protection people need. It’s simple fairness: Those who caused the damage and profited from it should pay to fix it.”
Candice Fortin, US campaign manager for 350.org, emphasized that the latest comments from Trump, whose Interior Department just moved to weaken restrictions on Arctic drilling, must be taken with a grain of salt.
In the same Oval Office statement on Monday, said Fortin, “Trump criticized countries championing wind energy and supported more oil extraction in the North Sea.”
“We don’t just need to tax fossil fuels’ windfall profits now, to be then forget about later,” said Fortin. “We need to end our dependence on oil, gas, and coal—and we need a permanent mechanism to make the fossil fuel industry pay its fair share and redirect those revenues towards protecting people and communities from the climate and cost-of-living crises.”
“If this is a genuine change of heart from a president whose budget bill included $18 billion in taxpayer handouts to Big Oil, we welcome it,” added Fortin. “But talk is cheap, here’s the real test: Will Trump throw his weight behind the Big Oil Windfall Profits Tax bill, which his party has been stonewalling in Congress since March?”
Nigel Farage urges you to ignore facts and reality and be a climate science denier like him and his Deputy Richard Tice. He says that Reform UK has received £Millions and £Millions from the fossil fuel industry to promote climate denial and destroy the planet. Donald Trump urges you to be a Climate Science denier like him. He says that he makes millions and millions for destroying the planet, Burn, Baby, Burn and Flood, Baby, Flood. Power-mad orange gasbag Donald Trump says Burn, Baby, Burn.
US President Donald Trump listens as Interior Secretary Doug Burgum points at a map of Alaska during an event in the Oval Office on October 6, 2025. (Photo by Jim Watson/AFP via Getty Images)
“We should be banning drilling in the Arctic Ocean, not making it easier for industry to exploit and pollute.”
The Trump administration on Monday proposed weakening Obama-era safeguards for fossil fuel drilling in the Arctic Outer Continental Shelf, a move condemned by environmental groups as another industry handout that would make disastrous oil spills more likely.
The US Interior Department characterized the proposed changes, which will face a 90-day public comment period, as “targeted revisions” aimed at reducing “unnecessary regulatory burdens” that are limiting resource extraction off Alaska’s coast. The new proposal, according to the agency, “would update requirements related to blowout preventer real-time monitoring, Arctic source control and containment equipment, relief rig capability, subsea isolation devices, mudline cellars, oil spill response plan-holder reviews, crane operations on artificial islands, and suspensions of operations and production.”
The Trump administration unveiled the proposal as it pushed for a massive expansion of offshore drilling, even as the climate impacts of fossil fuel extraction continued to intensify across the US and worldwide. Joseph Gordon, campaign manager at Oceana, called the combination of expanded drilling and weakened safety standards “a recipe for catastrophe.”
“This attempted rollback would make it even harder to prevent oil spills or tackle the horrors that inevitably follow in the remote and fragile Arctic,” said Gordon. “Giving oil companies a pass on safety measures like blowout preventers would set a dangerous precedent that will put Alaska’s waters, wildlife, and people at risk.”
Cooper Freeman, Alaska director at the Center for Biological Diversity, said that “weakening rules for Arctic Ocean drilling is a truly terrible idea that threatens coastal communities and wildlife like bowhead whales and polar bears.”
“Arctic oil drilling is one of the most dangerous extractive activities out there, and cleaning up a spill would be nearly impossible,” Freeman added. “Stronger safeguards for Arctic offshore drilling came on the heels of the Deepwater Horizon blowout, where we learned that just one mishap can cause a catastrophe.”
President Donald Trump, whose 2024 campaign was boosted by fossil fuel industry donations, began targeting Alaska drilling regulations on the first day of his second White House term, signing an executive order attacking “punitive restrictions implemented by the previous administration that specifically target resource development on both state and federal lands in Alaska.”
In November, the Interior Department—led by Big Oil ally Doug Burgum—released a drilling plan targeting “every available offshore area in Alaska, including the High Arctic, which stretches 200 miles into the Arctic Ocean, with over 20 lease sales through 2031.”
“We should be banning drilling in the Arctic Ocean, not making it easier for industry to exploit and pollute,” Freeman said Monday.
Nigel Farage urges you to ignore facts and reality and be a climate science denier like him and his Deputy Richard Tice. He says that Reform UK has received £Millions and £Millions from the fossil fuel industry to promote climate denial and destroy the planet. Donald Trump urges you to be a Climate Science denier like him. He says that he makes millions and millions for destroying the planet, Burn, Baby, Burn and Flood, Baby, Flood. Power-mad orange gasbag Donald Trump says Burn, Baby, Burn.
Power-mad orange gasbag Donald Trump says Burn, Baby, Burn.
