An Infosys spokesperson said, "The current proposal as we understand is to close down on tax loopholes in the US MNCs and crack down on their overseas tax havens. We do not believe that it has anything to do with IT outsourcing done by US corporations."
IT major Wipro too had similar comments to make.
But this move will have an impact on MNCs like Accenture and IBM. They are still studying the fine print to understand what could be the effect of this move.
However, this move in itself is not worrying. What is worrying is the whole protectionist environment off late that is happening in the US with regard to Indian IT companies.
A week or so earlier, there had been a proposed legislation introduced in the US by senators Grassley and Durban, which could restrict the number of visas that Indian companies can apply for. This, given with the fact that they are being forced to hire more locally and given the fact that the kind of economic environment that we are in, IT companies are seeing budgets slowing down, client spends tightening up. It indeed seems that the dark clouds over the Indian IT sector are getting darker and it is going to be a tougher environment for them going ahead.
