The First Official Ax Falls on Off-shoring

It’s been a long time coming, but the first major step towards the elimination of off-shoring has finally been launched by the White House. Before the end of the year we should also see the elimination of the H1-B Visa program. I rather liked this quote:

The current law, Obama said, “says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York. “

Under the plan, companies would not be able to write off domestic expenses for generating profits abroad. The goal is to reduce the incentive for U.S. companies to base all or part of their operations in other countries.

Just how may clients do you guys have with a plethora of Caymen Islands divisions/joint ventures/subsidiaries? I’ve got some. Oddly enough these clients are the same ones who have been listening to the inexcusably bad advice of the Gartner Group and riding the off-shoring bandwagon. Given the speed with which the credit card laws got slammed through the first round of voting and their immanent passage in the next round, this shouldn’t take more than a month or two to get slammed through. It’s a win-win for the elected officials doing the voting. They are pulling back in money that had been funnelled out fo the country for years by the same individuals who brought us the global recession all wrapped up with a bow and using it to pay down the debt incurred by the government while sweeping that disaster up.