Palantir avoids taxes: special treatment for the tech kids of the US

Palantir, a leading technology company known for its data analytics software, has been accused of evading taxes by exploiting special treatment within the United States. According to a new report released by the European Public Service Union (EPSU), the firm pays just one-tenth of the taxes required under the global minimum tax rules. The report, which was shared with taz, reveals how Palantir structures its finances to minimize its tax obligations, even while benefiting from public contracts and infrastructure supported by taxpayer funds. The report highlights that Palantir’s profits in 2025 were estimated at around $1.66 billion before taxes, yet the company paid only approximately $21.7 million in taxes globally. This means that less than two percent of its total earnings went toward taxation. The discrepancy stems largely from the company's strategic relocation of profits to the United States, where it claims minimal tax liability. Despite generating 74% of its revenue from U.S. operations, nearly all of its profits, about 96%, were recorded in the country, allowing it to take advantage of favorable tax policies. Palantir, founded in 2003 by Alex Karp, specializes in predictive analytics and has become one of the world's largest technology firms. Its business model has flourished, particularly after it began reporting consistent profits in recent years. In the second quarter of 2025 alone, the company saw a 62% increase in earnings. With revenues growing steadily, Palantir has secured contracts with numerous government agencies worldwide, including the U.S. Immigration and Customs Enforcement (ICE) and police forces in Germany, such as those in Hesse. These partnerships have raised concerns among civil society groups regarding data privacy and the potential misuse of sensitive information. According to the EPSU report, much of Palantir’s European income is funneled back to its U.S.-based parent company through service fees. For example, 65% of the German revenue is attributed to “service charges” sent to the American headquarters. While this practice is legal, critics argue that it represents a deliberate attempt to circumvent higher tax rates in Europe. Jan Willem Goudriaan, general secretary of the EPSU, emphasized that legality does not absolve companies from scrutiny, especially when they simultaneously benefit from public spending and infrastructure. In the U.S., Palantir benefits from multiple tax incentives, including generous deductions and exemptions. A key factor is the “One Big Beautiful Bill,” a law signed by former President Donald Trump in early 2025, which provides substantial tax relief for certain businesses. Additionally, the company has accumulated what are known as "latent taxes", tax advantages that accrue during periods of financial loss. These provisions allow Palantir to defer paying taxes on its future profits, effectively reducing its current tax burden. As a result, Palantir’s effective global tax rate stands at just 1.55%, far below the standard corporate tax rates in countries like Germany, where the corporate income tax is 15%. This low effective rate raises questions about the fairness of the global tax system and whether multinational corporations can exploit regulatory differences to avoid their fair share of responsibility. While the OECD has introduced a global minimum tax framework aimed at ensuring equitable taxation, the report suggests that U.S.-based companies like Palantir may still find ways to sidestep these rules. The EPSU’s findings highlight the ongoing challenge of enforcing international tax standards in the face of complex corporate structures and national tax policies. As discussions continue on reforming global tax systems, the case of Palantir underscores the need for greater transparency and accountability in how large tech firms manage their finances.