Congress warns US HIRE Act may hit Indian economy if passed

NEW DELHI: The Congress on Tuesday warned that a bill introduced in the US Senate, proposing a 25 per cent tax on any American payments for outsourced work, will light a fire in the Indian economy if it becomes a reality. Congress general secretary in-charge of communications, Jairam Ramesh, made the remarks while referring to the Halting International Relocation of Employment Act, or HIRE Act , introduced on October 6 by Senator Bernie Moreno of Ohio. The bill has been referred to the Senate Committee on Finance, he said on X. The proposed legislation seeks to impose a 25 per cent tax on any US person making an outsourcing payment, defined as any money paid by a US company or taxpayer to a foreign person whose work benefits consumers in the United States. On Oct 6, 2025, Senator Bernie Moreno of Ohio introduced a Bill in the US Senate titled Halting International Relocation of Employment Act or HIRE Act. The Bill has been referred to the Senate Committee on Finance. The Bill proposes a 25% tax on any US person making an Jairam Ramesh (@Jairam_Ramesh) November 4, 2025 Ramesh said the bill could have a direct and significant impact on Indias IT services, BPO sector, consulting firms, and global capability centres (GCCs). While countries such as Ireland, Israel, and the Philippines may also be affected, Indias services exports, a major success story over the past 25 years, would face the greatest impact. He noted that the bill, in its current form, may or may not pass and could undergo modifications. It may just linger. But one thing is clear the bill reflects a growing US mindset that while blue-collar jobs were 'lost' to China, white-collar jobs should not be 'lost' to India, he said. Ramesh added that nobody expected a year ago that the India-US economic relationship would face so many challenges, with the HIRE Act being the latest example. If the HIRE Act becomes a reality, it will ignite a crisis in the Indian economy, which may have to adapt to a new normal in relation to the US, he said. The bill aims to curb outsourcing and promote domestic employment in the US by imposing a 25 per cent levy on payments made by American companies to foreign workers whose services benefit US consumers. Ramesh also shared a link to the provisions of the bill. HIRE Act or H-1b visa shock: Time for Indian IT industry to look within for reforms