May 26, 2014


Taxes, taxes, taxes…

It seems that now it has become one of the most popular topics of casual conversation, replacing the more common weather, sports, and smartphone features comparison.

Finding a skillful and experienced accountant can be paramount to an unscheduled blessing as those talented people know exactly how to legally reduce the amount of money paid to the government.

Everyone is aware of the fact that taxes are rising in the developed countries while the benefits received tend to be even more intangible. The recent scandal with the famous French film star who changed his citizenship proved once again that one must pay enough to have the privilege to live in Western countries or conduct business there.

According to the latest Forbes research, out of 8 working hours a person devotes 2 hours and 26 minutes to paying various taxes: federal, state, and local.

It must be mentioned that the authors of the initial version of the American Constitution would claim some of these taxes to be absolutely inhuman and, what’s more, illegal. At the beginning of the 20th century, the US government took $1 of every $12 earned, while now they take $4 and they are striving to increase that volume.

The famous political election carrot of taxing only the rich turns out to be just sheer nonsense if one gives the idea a second thought. All owners of small and medium-sized businesses are targets of these taxes and be sure that their respective employees are doomed to share that burden.


However, today’s economics has brought a relatively new concept regarding how to fight all those injustices by simply sweeping the production lines into the countries where the tax legislation is not that severe.

At the end of the 20th century, outsourcing to other countries mostly in the developing regions of the planet became imperative not only for industrial production but also for more sophisticated and refined sectors of the economy. India was the first to show that software development could be outsourced and there is no need to pay high salaries to demanding Western professionals and additional taxes to avid Western governments.

Now, software development companies are numerous, most of them have gained precious experience, built up their virtual software muscles, and gained the so-much needed reputation and good standing. They are situated all over the world, and to find a reliable software outsourcing partner is not a problem anymore.

The benefits of such an outsourcing partnership are hard to overestimate. Let alone getting a quality product at the end of it all, a customer receives much more: the possibility to save a significant amount of resources on hiring additional employees, renting space for them to work, supplying them with all the necessities for a fruitful working process, paying them high Western salaries, and paying high Western taxes for all of the above.

Most emerging or already established centers of software outsourcing all over the world are countries that are highly motivated to attract Western companies and develop that sector of their economy. That’s why either the corresponding tax or all the tax legislation in general is quite welcoming.

Moreover, most of the time, a software customer will not even think of all that. They just pay for the provided software services and that’s it.

There is no need to think whether the salary paid to his or her employees is high enough and whether or not they will leave the project at the most crucial point and what tasks to find for them when the main project has already been completed.

Software customers who turned to outsourcing services are proud of their actions, being aware that in doing so they help yet another country join the club of the developed states, contributing to its economy with the taxes paid by their local outsourcing partner.

However, all of those intangible considerations are nothing compared to the money that remains in consumers’ pockets instead of being sacrificed to support another fabulous federal idea with unclear aims and even more doubtful outcomes.


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