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India's IT sector nervous as US proposes outsourcing tax
India’s IT sector faces uncertainty as a proposed U.S. outsourcing tax threatens contracts, costs, and client confidence, sparking legal and lobbying battles.
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Reuters - Thu, 11, Sep 2025
- 10:10 EDT
- 39
U.S. Senator Bernie Moreno (R-OH) speaks during a Senate Banking, Housing, and Urban Affairs Committee confirmation hearing in Washington, D.C., U.S., April 10, 2025. / REUTERS/Kevin Mohatt/File Photo
India's massive IT sector faces a lengthy period of uncertainty with customers delaying or re-negotiating contracts while the U.S. debates a proposed 25 percent tax on American firms using foreign outsourcing services, analysts and lawyers said.
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.
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