China offers tax cut to outsourcers

China, keen to end India's dominance in the outsourcing industry, will not levy operating taxes on offshore service outsourcing business in 21 of its key cities till 2013 to promote growth of the industry, reports India Times.

The 5% operating tax exemption will run from 1 July this year until 31 December 2013, the Chinese government said.

According to a joint statement released by the ministry of finance, the state administration of taxation and ministry of commerce, offshore service outsourcing income refers to service revenue arising from contracts signed with offshore entities for providing information technology outsourcing, business processing outsourcing and knowledge processing outsourcing services.

Japan-based brand notebook vendors Toshiba, Sony and Fujitsu are all expected to increase the ratios of outsourced notebooks to Taiwan-based ODM makers in 2011 in order to strengthen their product competitiveness, according to sources at Taiwan notebook makers, reveals DigiTimes.

Toshiba is likely to increase the outsourcing ratio to 80 to 90% in 2011, as Sony will jack up the ratio to over 90%, the sources noted.

Fujitsu will also raise the outsourcing ratio in 2011. Fujitsu's ratio of outsourced notebooks will reach about 50% in 2010, the sources noted.

The global IT security software market is set to be worth more than $16.5 billion in 2010, it has been reported, states Hotnews.

According to research consultancy Gartner, the sector will expand by 11.3% this year as more companies, including IT outsourcing providers, ramp up their investment.

Last year, the security software market was worth $14.8 billion, the company reported.