US companies with registered offices in Bermuda, such as world-leading consultancy firm Accenture, face being barred from all US Federal Government contracts as "punishment" for reaping tax advantages by being based offshore.

In a proposed further eroding away of US firms' ability to benefit from setting up so-called "shell corporations" in offshore jurisdictions in order to avoid paying federal taxes, Democrat Senator Carl Levin is seeking to bar all such companies from being awarded federal government contracts in future.

The Michigan politician has previously succeeded in outlawing off-shore registered US companies from winning contracts in four federal departments, namely; Homeland Security, Transportation, Treasury, Housing and Urban Development.

His sights are now set on a government-wide ban on such contracts being awarded to US companies that have set-up offshore to escape federal taxes.

The giant Accenture, which split from Arthur Anderson LLP in 2000, and established its legal address in Bermuda the following year, would be one of those impacted by such a law should it be passed.

Its consulting contracts with the US government are estimated at more than $1 billion a year.