US' proposed HIRE law puts Indian IT firms, GCCs in a fix: Experts

This could not have come at a worse time because the IT companies are already under pressure for low single-digit growth for two consecutive years due to weak macroeconomic environment

A proposed US law that imposes a 25 per cent tax on companies that outsource work threatens to upend the economics of Indian IT and global capability centres (GCCs).

 

According to industry and tax experts, US companies may see their tax burden surge by almost 60 per cent due to this.

 

If enacted from January 1, 2026, US companies would need to carefully reevaluate their global sourcing strategies. This is because the combined impact of excise, state, and local taxes could dramatically increase the cost of engaging foreign labour and services.

 

US Republican senator Bernie Moreno of Ohio introduced the