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Outsourcing
tax forms not a threat
Many
large accounting firms are massively outsourcing
their tax return forms to India in order
to reduce costs and free up American accountants
for more important accounting tasks such
as financial and estate planning. Critics
of this outsourcing increase say the possibility
of identity and terrorist theft of personal
information is simply too great for the
short-term benefits of cheaper labor.
The
trend might pose serious security risks,
but many accounting firms say that they
simply cannot ignore the trend and allow
themselves to be undercut by their competition.
Also, many of the customers of these outsourcing
firms are quite happy with the reduced cost
of their tax returns. A 1040 tax form prepared
in India can cost as little as $75, compared
to the United States where it would likely
cost around $150 dollars. But what if the
customer isn't told that their tax returns
are being sent across a dozen time zones
and being completed by foreigners?
While
outsourcing does lower the cost for tax
return completion, many firms do not tell
their customers that their tax returns are
being sent to India for finalization. Currently
it is not mandatory that firms divulge the
location that they are sending the tax returns
to or that they are even sending them to
another country. Many prominent politicians,
including Senator John Kerry, are lobbying
for a law stating that all companies must
inform their customers about whether their
tax returns are being sent to another country.
That way, they give customers a choice of
whether or not they want their tax returns
and personal information outsourced.
Another
idea is that all companies must label the
country that the information was sent to
in order for the customer to know exactly
who filed their tax returns.
But,
it is impossible to know exactly who has
access to personal information that is being
sent across the world. Despite the fact
that every outsourcing accounting firm stresses
the level of security that they place around
the returns it is still possible, but not
likely, that a terrorist group could get
their hands the information being sent.
The terrorist group could use the information
to gain access into the United States or
track down Americans living abroad and take
them hostage.
But
this is a very doubtful threat. The people
who file these tax returns are all educated
college graduates who are in premiere jobs
in India, risking termination and certain
incarceration for selling this information
would be a risk not worth the gains. The
security around these Indian companies is
extremely strong as well. The computers
that the Indian accountants work on have
no CD or floppy disk drive and they have
no access to a printer or fax machine. They
are not allowed to bring in briefcases or
purses and are identified by microchip encoded
ID cards. They are also constantly watched
by a very sophisticated security system
and some companies even have armed guards
at the doors of their office buildings.
With all of the security and precautions
taken to keep American take returns and
personal information from being misused
there is very little threat from identity
theft or terrorist usage.
Yet,
there are two main problems with this massive
amount of outsourcing that accounting firms
are promoting. With all the lesser forms
and a vast majority of tax returns going
to India many young accountants are being
cheated out of proper training and aren't
afforded the opportunity to learn how to
properly perform the cornerstone of their
profession. The biggest problem for the
future of outsourcing will come when India
and other fairly advanced and trustworthy
countries begin outsourcing themselves.
What will happen when India begins to outsource
its less important tax forms to Pakistan
or Afghanistan? These poorer countries do
not have the money to afford such strict
security measures and they certainly aren't
as trustworthy as India has been. The future
of tax outsourcing seems to be the real
threat to American citizen security. There
must be a halt to outsourcing at some point.
Daniel
Bracke is a second year English major at
CSULB.
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