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Outsourcing IT Jobs Offshore to support Operations in the USA is Tax Evasion!

Let's catch those lost Tax Renvues from the Outsourcers

CatchIt seems that the new culture in the IT Industry is to either Outsource the IT department to an Offshore location or to create a Captive Satellite IT Department in an Offshore Country (i.e. India).Many of the big time IT Consulting and IT Service companies are leaders in the transferring and OffShoring of IT Jobs. They’re doing this to make a few extra pennies per share for their shareholders who reside all around the globe. Corporate America is no longer Corporate America.

So, back home what is happening is that IT Jobs are lost and hourly rates / salaries are cut. The Larger IT Consulting Organizations control the flow of work…..which in many cases ends up in an Offshore location. For the Jobs that are Offshored, the employers have cut out the cost of their Payroll Taxes (ie. Federal, State, FICA, Medicare), but still have their Operations in the USA supported from the Offshore location. The elimnation of the Payroll Taxes in the USA is the “core cut in cost” that the Outsourcers are profiting on and the incentive to continue to Offshore as many jobs as they can. To me this is called “Tax Evasion”.

Yes, we’re dealing with big time “Tax Evasion”. If you’re working Physically in New York City or Chicago, you will pay from your earnings, Federal, State, FICA, Medicare, State Disability and unemployment taxes. In some case you will also owe a local City tax (i.e. NYC). Now with OffShoring, you can cut those jobs in USA, eliminating the earning and taxes paid in the USA, but still have your USA based Operations supported from an Offshore location.
We must find a way to stop this “Tax Evasion” now and bring back equity in out Job IT market!

I think one way to fight this dilemma is to bypass these Larger IT Consulting firms (who are the largest Outsourcer of IT Jobs Offshore) and deal directly with the “end clients”. By doing this, we can cut out the Larger IT Consulting firms high overhead / profit margin that is factored in their billing hourly rate to the end clients, thus cutting cost to the “end client”, while keeping our jobs, salaries and tax obligations here in the USA.