By a vote of 56-42, the US Senate rejected a bill in the US Congress that would have discouraged outsourcing, an $11 billion business in the Philippines.
According to reports, the US Senate rejected Obama administration’s “Bring Jobs Home Act” which would have eliminated tax breaks for companies that ship jobs to other countries, and could encourage firms by giving a 20% tax deduction on costs associated with closing outsourced operations and transferring jobs to the US.
“Outsourcing business services to the Philippines help make American companies more competitive and profitable,” Benedict Hernandez, Business Processing Association of the Philippines (BPAP) president and CEO was quoted as saying.
“Profitable companies hire more workers, both here, and in the United States,” he added.
In fact, US Senator Orrin Hatch, R-Utah had said that there is no tax break for outsourcing, saying the bill is “devoid of serious content because it is of political rather than economic priorities.”
Local reports have said that in 2011 the IT-BPO industry in the Philippines generated more than $11 billion in revenue and employed almost 640,000 Filipinos. It is expected to grow to $25 billion in annual revenue and employ 1.3 million by 2016.