India's IT Sector Nervous as US Proposes Outsourcing Tax (reuters.com)
- Reference: 0179161234
- News link: https://tech.slashdot.org/story/25/09/11/123207/indias-it-sector-nervous-as-us-proposes-outsourcing-tax
- Source link: https://www.reuters.com/world/india/indias-it-sector-nervous-us-proposes-outsourcing-tax-2025-09-11/
> The sector is likely to be on the receiving end of a bill which, though unlikely to pass in its nascent form, will initiate a gradual shift in how big-name firms in the world's largest outsourcing market buy IT services, they said. Still, with U.S. firms having to pay the tax, those heavily reliant on overseas IT services are likely to push back, setting the stage for extensive lobbying and legal battles, analysts and lawyers said.
>
> India's $283 billion information technology sector has thrived for more than three decades exporting software services, with prominent clients including Apple, American Express, Cisco, Citigroup, FedEx and Home Depot. It has grown to make up over 7% of GDP. However, it has also drawn criticism in customer countries over job loss to lower-cost workers in India. Last week, U.S. Republican Senator Bernie Moreno introduced the HIRE Act, which proposes taxing companies that hire foreign workers over Americans, with the tax revenue used for U.S. workforce development.
[1] https://www.reuters.com/world/india/indias-it-sector-nervous-us-proposes-outsourcing-tax-2025-09-11/
Good (Score:4, Insightful)
I'm tired of dealing with substandard IT services, from both India AND China. The language barrier is one thing, but I don't think I've ever spoke or worked with an agent from either country that could do anything other than read from a script. Once the problem deviates from the script they were useless.
Granted; US support is a mixed bag. Sometimes it's great, sometimes it sucks, but at least sometimes it IS great. That's not something I've ever experienced with Indian or Chinese support.
Re: (Score:2)
I've dealt with call center agents from the USA, China, India, down to local ones. And all of the agents that take the call pretty much only run a script to cover the most common cases. But all of them can and will kick the call up to people who can actually help. The one thing I hate (and call centers from all parts of the world still do this) is when they make you walk through all the pointless troubleshooting steps in the script before they escalate your call.
Re: (Score:3)
As crap as AI is shaping up to be, it still seems to be not much worse than a call center in India. This adds a second front in that war.
Re: (Score:2)
I'm not defending India, but their workforce does speak English, just with a heavy accent. Still, it's more comprehensible than the Scottish accent.
Re: (Score:2)
Och aye!
Re: (Score:2)
Some of the at is cultural, some is education but a lot of it just selection bias I expect.
Most companies are going to outsource their first and second lines of support not the stuff that requires technical ability and deep knowledge about systems or decision making authority to resolve. Not that you can't or that some don't but the simple-er basic customer service tasks are obviously the easiest thing to throw over the wall to some third party.
My point is frustrating as it is, I don't think agents are to b
Re: (Score:2)
Instead, you will just get substandard IT services from genuine US employees :)
Re: (Score:2)
The support that is bad now will not get better when it goes to the US. Some support is good because the ones paying for it want it it be good, not because of from where it is provided.
Closing the barn door afterward (Score:2)
Seems like this is a bit on the too-little, too-late side. Offshoring has been occurring for so long that the divisions set up in other countries are mature now. They're able to locally train local staff, not only for providing international support, but for providing local/regional support within their own countries or economic trade zones.
Onshoring call centers. (Score:3)
Cannot happen soon enough. I recently dealt with insurance issues that had the paperwork in the US and the bad scans thereof in the Phillipines. The two locations claimed they could not contact each other. That took a month to resolve.
What's good for the goose (Score:2)
It's interesting how the conversation is so one sided.
Trump threatens action against countries that propose similar actions about cloud and other tech but the rest of the world should just sit back and take it when it affects the US?
Life is going to get expensive for the US.
What about American technology firms.. (Score:1)
That have a large contingent of employees in other countries (IBM has more employees NOT in the US) Loophole...
Won't be losing sleep (Score:2)
Having worked for one of those Indian IT Service providers and seen how they have treated their off-shore employees. I sure won't be losing sleep if they get a little extra tax that helps pay for the damage that they have caused.
Good (Score:2)
Good
AI will kill the outsourcing first (Score:2)
Corporations are always looking to lower costs. Outsourcing to India was a win for them.
However, corporations now have an even cheaper, more convenient way to reduce support costs.
I expect that AI will take over and end up killing outsourcing as well as US jobs.
We can all then sit back and relax without the grind of daily work. We just need the welfare state to ramp up so we don't starve.
Please pass this!!! (Score:2)
Wow..one of he first bills I would think most EVERY American could get behind.....
Let's keep the jobs here friends..eh?
I for one would be thrilled to hear a customer service phone call answered without an accent so thick I need my iPhone translate listening on the other line to let me know what the fuck is being said on the other end...
Re: (Score:1)
Be careful what you wish for. This is something that Canada and the EU might want to return in kind, because the massive untaxed trade imbalance between us and the US regarding digital goods and services has been a thorn in our governments' side for a good while now.
Re: (Score:2)
I agree with you. Me and my fellow unemployed team members from my last gig (only 1 out of 7 has found a job since early April) would gladly put our misguided hopes and dreams for some relief.
Re: (Score:2)
> massive untaxed trade imbalance between us and the US regarding digital goods and services
Digital goods, like services, are difficult to track across borders. Perhaps the best solution would be to overhaul our tax and tariff system. Delete all taxes on profits and capital gains. Replace them with a flat revenue tax (set to a revenue neutral level as best as possible). With only one deduction allowed: W-2 wages paid.
Re: (Score:2)
One time back in the '10s I called Apple for something at about 5PM Austin time. It got answered by someone in Ireland. My mind was blown, both because I think Apple had recently opened a call center in Austin, and because that meant it was almost midnight at the call center.
Anyhow, it's about time they figured out a way to "tariff" off-shored non-manufacturing jobs.
Re: Please pass this!!! (Score:2)
It really is kind of insane for a service based economy to outsource services and labor as a first resort.
Re: (Score:2)
Some of his policies orient around tariffs to keep jobs here. The only people who support free trade with low income countries are people who want to make a buck off of the significant wage gap, that and people who can't see past "Trump is bad", and think for themselves. Yeah, we pay a little more, but as demand for labor increases we also get paid more as well. This stuff doesn't happen overnight, but we're also seeing countries build in the US now. And we're seeing that you need to hire American or legall
Re: (Score:2)
I agree with you entirely except the 'only people' part.
They macro trends work or at least will ultimately work as you describe but in any economic reorganization you are going have some groups that make gains and others that fall behind. There is a segment of the population that I suspect isn't really trying to exploit the wage gap so to speak but also isn't sure their corner of the labor market is as impacted by foreign participants or trade as others. They rightly wonder if they are going to experience i
Re: (Score:2)
Be very careful what you wish for. It might look good on the surface, but I think would absolutely destroy American companies' ability to compete internationally unless it is very narrowly defined (and if it is narrowly defined, it won't have much of an impact).
What exactly counts as "offshoring"? All global companies set up subsidiaries abroad which are technically separate companies in just about every country they operate in and basically have contracts with the parent company. Do all these get taxed? Co