Filippino Americans Say No To Schumer Bill

According to news reports, the Filippino American community has opposed the recently proposed Shcumer bill, which puts a tax on outsourcing. The group went to Washington DC to visit Senators Charles Schumer and Kristen Gillibrand in person.

The proposed bill by Senator Schumer puts a tax on call centers positioned overseas by U.S. firms. The bill places fees on companies that offshore customer service. This includes call center outsourcing to Philippines and India. According to the bill, U.S. firms with contact centers abroad will pay a fine of 25 cents/call from the U.S. Additionally, the caller will given information like the country in which the call is received.

One member of the group, Loida Lewis said in an interview with the Asian Journal, "Sen. Gillibrand promised to speak to Sen. Schumer to incentivize multinationals who establish call centers in the USA rather than penalize those who are already established abroad.”

A letter to Sen. Schumer said that the bill does not reflect the valued image of the U.S. as a big brother, in particular to the Philippines, which has a significant presence in the outsourcing industry. It is also relevant that developing countries like the Philippines are in the process of rebuilding from a global recession that has roiled economies around the world.

The National Federation of Filipino American Associations (NaFFAA) leaders also said that the 25cent tax would defeat the purpose of having call centers abroad.

Josephine Romero, Philippine Trade Commissioner, told the Asian Journal, "It is no secret that Americans continue to find themselves in a bind and California, where I now am based, is among those with the highest unemployment rate in the country.”

She added, “That said, while the government thinks up measures to protect its people, the final decision rests on the corporations who have to run their operations and account to their shareholders. They are duty bound to analyze how the possibility of a 25-cent tariff on call center service will affect the way they deliver quality customer service and keep their businesses going.”

Some U.S. based outsourcing firms like Hit Rate Solutions are saying that the Schumer bill is an outright display of protectionism. Adam Shore, operations director of Hit Rate said that the bill reveals a lack of understanding of the outsourcing sector and business operations as a whole. The bill, if passed, would be detrimental to companies in the developing world and the U.S.

He added, that Schumer does not understand the number of calls that are placed to call centers each day. There is a misunderstanding that only big corporations are involved in outsourcing – this is not the case, says Shore.

Incidentally, the bill which has already passed in the House and is now being processed in the Senate is to provide a disincentive to outsourcing. But Shore believes that the alternative to offshoring in this economy is not hiring at all. Hence, it is likely that the Shumer bill could backfire and create a disincentive for business as a whole.