Premier Ewart Brown scoffed at the suggestion US President Barack Obama would follow through with his threats to shut down tax havens when he swept to power last year, but he will be taking the matter much more seriously now in the wake of the Obama administration this week unveiling budget plans which could increase taxes on Bermuda reinsurers with US subsidiaries.

That is according to Shadow Finance Minister E.T. (Bob) Richards, who said he was laughed down after delivering a speech in Parliament warning of the threat posed by US government to Bermuda as an offshore financial centre and insurance market.

But he was encouraged that the Bermuda International Business Association (BIBA) and the Association of Bermuda Insurers and Reinsurers (ABIR) continued to lobby Washington over the value of the Island's insurance and financial industries.

"I recall making a speech in Parliament in January 2009, saying that we have a fight on our hands if this person wants to execute what he stated he wanted to do in his election campaign and the Premier just laughed at me, but he is not laughing now," he said.

"At least our friends at BIBA and ABIR went out and got some data on the value of the Bermuda insurance sector to America and we have some ammunition to fight this with.

"But these people in Government just don't anticipate anything and therefore are caught flat-footed when it happens.

"The situation is obvious for all to see that the US government is desperate for cash and they will look in all places to find it, including offshore jurisdictions."