What is the COBOL Tax?

Most of us who are not white-collar criminals are intimately familiar with the concept of paying taxes.  We pay tax on our incomes and when we go shopping.  There are taxes on all kinds of products and services; taxes of varying amounts for a variety of different reasons.  Every year we send off an income tax return and pray that, by some small miracle, our employer has withheld too much.

The Oxford Dictionary defines a tax as:

a compulsory contribution to state revenue, levied by the government on workers’ income and business profits, or added to the cost of some goods, services, and transactions.

While the COBOL Tax is not levied by any government, it is compulsory, and it certainly does cut into profits!

So, what exactly do we mean when we talk about the COBOL Tax? To better understand, we first need to step back in time 60 years to when it all started.

A Language for Business

COBOL is a programming language developed in 1959.  Based in large part on foundational work done by Grace Hopper, it was part of a US Department of Defense effort to create a portable language for data processing.

Aside from being a pioneer in the field of computer science, Grace was also a mathematician, professor, and Rear Admiral in the US Navy.

Designed primarily for business use, COBOL was quickly adopted by companies and governments for use in mainframe-deployed business, finance, and administrative systems.  Fast-forward 60 years, and a computer a million times as powerful as the ones that used to fill up an entire room can now fit into the palm of your hand.

When COBOL was invented, computers took up an entire room, and everything was stored on paper punch cards.

Hidden in Plain Sight

Despite huge technological changes since the 1950s, COBOL is still one of the most widely used programming languages in the world, with both corporations and governments still using millions of lines of code written as far back as the 1960s.  From ATMs, online banking, government databases, and even traffic lights, COBOL is an invisible part of our everyday lives.

Though slowly being replaced by more modern languages, COBOL makes up around 80% of actively used code.

Even though the programs these governments and corporations are running were written decades ago, they pay millions of dollars annually for licenses. This tax on programs written in COBOL, or COBOL Tax, prevents companies from making the necessary investments to modernize their ageing software systems, adapt to rapidly changing consumer demands, and stay competitive in today’s increasingly digital market.

Exorbitant COBOL license fees are a financial burden that prevents many companies from modernizing their software systems.

Commitment to Progress

At Raincode, we are committed to helping companies modernize their legacy systems and make them more compatible with the burgeoning digital economy.  In order to take a stand against this backward-looking practice of charging customers outrageous annual fees to compile decades-old programs, we have made our enterprise-grade COBOL compiler completely free.

Help us fight for a better-connected, more consumer-focused digital tomorrow!  Download our free compiler and start saving today!

Download the Raincode COBOL compiler for free