Taxing times for US firms brings biz to India

Pune, December 14: It is the next big wave of outsourcing that is hitting the Indian shores. After having successfully made its mark in information technology engineering and legal outsourcing space, it is now the turn of taxmen to seek Indian firms’ help in preparing returns. Having already prepared 3.6 lakh tax returns for the US this year, experts estimate that this figure would touch 16 lakh by 2011 bringing in revenues of $650 milllion.

The reasons are usual: Lack of qualified accountants and rising prices in the form of salaries creating a demand-supply mismatch. “The demand for returns offshoring stems from lack of accountants and excessive workload during the tax season. The number of certified professional accountants (CPAs) and other qualified accountants in the US are just not enough to meet the demands from increasing tax compliance, especially Sarbanes-Oxley related work,” Pune-based research firm ValueNotes’ chief executive officer Arun Jethmalani, who brought out a report, said. The CPAs in the US are equivalent to the chartered accountants in India.

Jethmalani said the US firm got a dual advantage by offshoring filing of returns: Apart for processing it at a faster rate, it also cuts the cost down by 40-60 per cent.

Buoyed by its success, the US firms are slowly sending more work like bookkeeping and financial statement analysis. “The whole outsourcing business requires a quite shift in thinking of the CPA firms and so comfort factor has to be really high in order to do that,” one of the facilitating unit Xpitax’s president Glen Keenan said.

http://cities.expressindia.com/fullstory.php?newsid=213241

There is that widely used phrase once again. "Lack of qualified" (accountants) My ass. :mad:

As we know, H&R Block can't do their own taxes right...

But I know small firms who do it right.

Even with the ridiculous complexity within the tax laws and codes.

And especially with American laws and codes, offshoring tax collection is a bit bizarre.

yet another example of why Sarbanes-Oxley is a Satanic law that came out of a Satanic Congress.

our laws??? Do they go to jail in America if the tax return isn't right or liable for the mistake???

being sent overseas? Don't we have enough trouble now with identity theft?

Such loyally to their country, to ship American's jobs overseas. I believe that we need not protect them in times of unrest. Let the companies in question go to the government's they are switching their allegiances to. Why should our tax dollars go to protect companies which shaft American workers?

My Tax accountant (also CPA) spouse was without a job for 6 months in 2001 - 2002. When he landed a job with a CPA firm, he discovered that a lot of their easier work was going to India.

Our government is in for troubles in the future. Americans are not majoring in the jobs that go to India. One day, this shortage that companies give for justification of outsourcing will be real. When the government can't find employees eligible for security clearances, what will they do then?

I think a lot of this started when the IT people started importing Indians because of the big Y2K scare. Did anyone experience any Y2K related problems? Did planes fall out of the sky? No, the hype was just to open the doors to lower the booming pay scale for American IT workers. Now, not only has it frozen salaries, it has moved many experienced IT professionals from upper middle class incomes to lower middle class incomes as we take unskilled jobs.

I was in IT working on a conversion job in 2000. The organization hired a consultant to run the conversion. Part of her job was to identify how many additional people it would take to accomplish the task. She was also one of two partners in a company that hired H-1b visa employees directly from India.
Her company would charge our Organization $100 per hour per H-1b consultant. The consultant would get $50 per hour.
That is $50 gross profit per employee per hour. At 20 H-1b employees brought in for 6 months to a year... You get the idea. Very profitable.

Funny how the H-1b contract consultants were carried on the books as assets and we regular employees were on the books as liabilities.

There are a lot of H-1b dependant companies out there fulfilling the greed needs of American companies. It is a very profitable business to be in these days. Too bad it is bad for Americans and for America in the long run.

And it's the same old lies time and time again. (Lack of qualified workers here.)

like a federal sales tax, we wouldn't need any tax accountants!

The point is that companies are falsely claiming there isn't enough qualified tax people in the U.S. when they try to justify outsourcing the work to foreign countries just to save money.

You should not have to be "qualified" to do your own taxes. I should not have to involve anyone outside my family in discussions about my household.

We started off as an agrarian society. We modernized, and moved onto a manufacturing economy. We automated that (and sent some overseas), and became a service sector economy. And now, much of that work can be offloaded to people just as talented as us, but who can do the work inexpensively. That will allow us to move further up the food chain into what people are calling the innovation economy, which is about using an educated workforce with creativity to come up with new technology and medical breakthroughs.

the top 1% move up the food chain and the remaining 99% become impoverished.

Our school systems are below average based on global standards...we've reduced grants offered to schools and the corp. sector, so don't expect any breakthrough technologies coming out of this country anytime soon.

Offloading work, you say? I believe you mean sell out the middle class in order to make a buck next week instead of next month. Corporate greed, my friend, is the sole driving force.

Maybe if one is a CEO, perhaps.

on edit: Tombstoned already, I see.