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• Ukraine is the leading country in Central and Eastern Europe in the area of IT outsourcing

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  Olga Tuchina    Premium Member

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  Ukraine is the leading country in Central and Eastern Europe in the area of IT outsourcing

  These days Softengi as all software vendors in Ukraine are closely following all developments around new Tax Code of Ukraine. The draft Tax Code wasn't even close to what was hoped for tax reform, and, in fact, contained numerous new provisions negatively impacting the business environment in Ukraine and IT outsourcing industry in particular. Discussions have been underway for almost three months and IT companies are actively seeking improvements to the draft Tax Code as the tax reform may either boost development and growth of IT industry in Ukraine or destroy it.
  
  The IT outsourcing industry in Ukraine shows considerable growth during the last decade. Recent studies indicate that currently Ukraine holds its position among most attractive outsourcing destinations and is surely moving towards the top of the list.
  
  
  Thus, according to Annual Global Outsourcing Industry analysis GS100, Ukraine is on 11th place in the Top 20 list of largest global delivery centers in terms of number of people deployed. And Ukraine is the first among Central and Eastern European countries outrunning Russia, Belarus and Poland in this list.
  
  
  Similar result shows the catalogue of IT outsourcing providers from Central and Eastern Europe – ITOlist.eu (the project of Central and Eastern European Outsourcing Association – ceeoa.org). According to 2007 and 2008 CEE IT Outsourcing Review, Ukraine holds the first position among CEE countries in terms of market value, number of IT outsourcing companies and number of professionals involved in IT outsourcing services.
  
  
  For the last decade market value of IT outsourcing services in Ukraine was showing constant growth, except for the last couple years, where due to the global uncertainties of the economy IT outsourcing activities remain sluggish.
  
  
  Source: Market Visio research “Ukrainian IT Service and Products Export Market 2003”
  Research by GOAL Europe “Outsourcing Industry in Ukraine 2007”
  CEE IT Outsourcing review 2007
  CEE IT Outsourcing review 2008
  
  Besides the global uncertainties of the economy, Ukrainian IT outsourcing industry is very much affected by the economical and political situation in the country. Many competitors of Ukraine in IT outsourcing have established special taxation policies for outsourcing providers thus placing them in more favorable position and promoting industry growth.
  
  For example, India, China, Brazil, Russian Federation, Romania have several times lower tax rates for software vendors than Ukraine. Belarus has special Government program for stimulation of software development industry: Belarus Hi-Tech Park provides comfortable business environment for IT business with its special taxation conditions unprecedented for the European countries.
  
  
  Ukrainian software vendors through the professional alliances are trying to introduce new, favorable for IT industry, provisions aimed to help software companies to sustain and overrun the competition.
  
  Being a member of Ukrainian Hi-Tech Initiative, a leading Ukrainian alliance in offshore software development, Softengi is also engaged in new Tax Code discussions and hopes that the voice of IT Outsourcing industry will be heard by legislators and taken into account.
  
  • 21 Sep 2010, 10:06 am
  Olga Tuchina wrote: > These days Softengi as all software vendors in Ukraine are closely > following all developments around new Tax Code of Ukraine. The draft > Tax Code wasn't even close to what was hoped for tax reform, and, in > fact, contained numerous new provisions negatively impacting the > business environment in Ukraine and IT outsourcing industry in > particular. Discussions have been underway for almost three months > and IT companies are actively seeking improvements to the draft Tax > Code as the tax reform may either boost development and growth of IT > industry in Ukraine or destroy it. > > The IT outsourcing industry in Ukraine shows considerable growth > during the last decade. Recent studies indicate that currently > Ukraine holds its position among most attractive outsourcing > destinations and is surely moving towards the top of the list. > > > Thus, according to Annual Global Outsourcing Industry analysis GS100, > Ukraine is on 11th place in the Top 20 list of largest global > delivery centers in terms of number of people deployed. And Ukraine > is the first among Central and Eastern European countries outrunning > Russia, Belarus and Poland in this list. > > > Similar result shows the catalogue of IT outsourcing providers from > Central and Eastern Europe – ITOlist.eu (the project of Central and > Eastern European Outsourcing Association – ceeoa.org). According to > 2007 and 2008 CEE IT Outsourcing Review, Ukraine holds the first > position among CEE countries in terms of market value, number of IT > outsourcing companies and number of professionals involved in IT > outsourcing services. > > > For the last decade market value of IT outsourcing services in > Ukraine was showing constant growth, except for the last couple > years, where due to the global uncertainties of the economy IT > outsourcing activities remain sluggish. > > > Source: Market Visio research “Ukrainian IT Service and Products > Export Market 2003” > Research by GOAL Europe “Outsourcing Industry in Ukraine 2007” > CEE IT Outsourcing review 2007 > CEE IT Outsourcing review 2008 > > Besides the global uncertainties of the economy, Ukrainian IT > outsourcing industry is very much affected by the economical and > political situation in the country. Many competitors of Ukraine in IT > outsourcing have established special taxation policies for > outsourcing providers thus placing them in more favorable position > and promoting industry growth. > > For example, India, China, Brazil, Russian Federation, Romania have > several times lower tax rates for software vendors than Ukraine. > Belarus has special Government program for stimulation of software > development industry: Belarus Hi-Tech Park provides comfortable > business environment for IT business with its special taxation > conditions unprecedented for the European countries. > > > Ukrainian software vendors through the professional alliances are > trying to introduce new, favorable for IT industry, provisions aimed > to help software companies to sustain and overrun the competition. > > Being a member of Ukrainian Hi-Tech Initiative, a leading Ukrainian > alliance in offshore software development, Softengi is also engaged > in new Tax Code discussions and hopes that the voice of IT > Outsourcing industry will be heard by legislators and taken into > account.