The media circus continued its focus on Bermuda as a 'tax haven' magnet for US corporations yesterday with a tongue in cheek column from Newsweek and a Boston Globe article on US legislators efforts to shut down the Island's "loophole exploited by corporate expatriates".

In a Newsweek Web Exclusive, columnist Gersh Kuntzman said he was moving the Gersh Kuntzman Company headquarters to the Island:

"Following the lead of dozens of American corporations, I've decided to move the corporate headquarters of my writing, editing and snack-food testing company from Brooklyn to the tax-free island nation of Bermuda," he wrote.

Mr. Kuntzman continued that "scores of US companies are reincorporating in Bermuda to avoid taxes".

Referring to an article in the New York Times on the subject by tax journalist David Cay Johnston, Mr. Kuntzman surmised: "It's so easy to do, the Times said that it's amazing that we have any corporations left in this country."

Looking at how much money some companies have reportedly shaved off their US tax bills - $400 million in savings for Tyco, and estimates of savings in the region of $125 million for three other manufacturing companies looking to reincorporate on the Island: Stanley Works, Ingersoll-Rand and Cooper Industries - Mr. Kuntzman reasoned: "That much gravy is worth the indignity of wearing plaid shorts to business meetings."

The thought led Mr. Kuntzman to contact the Ministry of Finance, and the end result was that Assistant Financial Secretary Ifor Hughes went through the incorporation process with him.

Mr. Hughes also reportedly e-mailed copies of the incorporation forms to Mr. Kuntzman.

Mr. Kuntzman said the forms "were so simple that I was convinced he (Mr. Hughes) had erroneously sent me applications for a St. George's dog license and a Hamilton parking permit."

But in the end Mr. Kuntzman concluded that he would not move to the Island as he would still be subject to taxes on his US-sourced income.

Meanwhile an article yesterday by Boston Globe journalist Glen Johnson followed the introduction last week of a bill to the US Congress, by Massachusetts representative Richard Neal, designed to "prevent corporations from avoiding the United States income tax by reincorporating in a foreign country".

The Boston Globe quoted Mr. Neal as having said to his fellow Congressmen: "I hope you will join me today in shutting down this loophole exploited by corporate expatriates before one more American company decides to shelve the Stars and Stripes to save some on the bottom line," he said.

The story, as with other recent media reports, focused on the reported savings from formerly US-based corporations: "Tyco International Ltd., whose leaders work out of Exeter, New Hampshire, has been based on the British colony since 1997. Last month, Stanley Works of New Britain, Connecticut, announced it would reincorporate on the island later this year."

The article continued: "Like hundreds of other US businesses, they have found that spending as little as a few thousand dollars to incorporate on the island - sometimes for a presence no greater than a mailbox - can spare them millions in US tax liability. The Internal Revenue Service estimates such manoeuvring costs the US Treasury $70 billion in tax receipts annually."

The article goes on to state that the Island's international business sector is under-regulated: "Today, international business outstrips tourism as the main source of income on the island, located about 550 miles off North Carolina. Bermuda has no income tax, no capital gains tax, and little business regulation. Shareholders cannot sue corporate officers and directors, as they can in the United States, and Bermuda does not enforce US court judgements against its companies."