FortySouth

The Obama Administration recently announced proposals for revision of the US Tax Code, including the imposition of tougher regulation for when profits earned abroad by US companies should be taxed in the US.

Currently, a company that offshores a business process from it’s parent in the US to one of its subsidiaries overseas, can claim an immediate tax deduction on the resulting foreign income that is the difference between the foreign country’s corporate tax rate and that of the US. The US combined federal-state statutory corporate tax rate currently sits at 39.3%, second among OECD countries to Japan.

The claim can be made while the company defers paying taxes until later when the income is brought to the US, if ever. Continue reading

Clearly, Kenya is laying its claim to a share of the global outsourcing market. And people are taking note.

As noted in the search insights below, interest in the concept went through the roof in 2008; contrast that to 2005 when India completely dominated.

But despite the enormous interest, the projected growth of the sector in the midst of a global economic downturn and the foreseen coming death of Indian outsourcing, why is progress in Kenya’s Business Process Outsourcing sector slow on the uptake?

Two reasons: prohibitive bandwidth costs and the “fear of exposure” among some BPO firms. More >>