Hi and welcome here.

There's a few things you have to change and delete. Let's see
Code:
@ INCLUDE "P18F2220.INC"	 ;processor specific variable definitions
@	LIST P=18F2220 ;directive to define processor and file format
you don't need them, PBP do it for you, just delete those lines above

Code:
DEFINE OSC = 20
must be written like
Code:
DEFINE OSC 20
However, with this changed, you'll also need to change your OSC mode in your config fuses... and then you'll probably have a list of Error[118]... read the following thread (at least post 1 and 5)
http://www.picbasic.co.uk/forum/showthread.php?t=543

Code:
RCSTA = $FAB
TXSTA = $FAC
SPBRG = $FAF
kinda hard to fit a 12bit result in a 8bit register Your program don't use the USART as it use a bit-banged solution (SERIN2/SEROUT2). If you want to use the USART, have a look in your manual for HSEROUT/HSERIN

HTH