Canadians banking their investments in Bermuda appear to be in the cross hairs of government tax collectors.

?The federal government (should) eliminate the use of tax havens in an effort to ensure that all corporations, businesses and individuals pay their fair share of taxes,? said Canada?s finance committee in a report it released to the House of Commons.

The group is making recommendations on what should be in the 2007 budget.

Statistics Canada estimates Canadians have stashed about C$88 billion out of the country in places like Barbados and Bermuda.

This is the second recommendation in Canada for action on offshore investors.

Last month Finance Minister Jim Flaherty introduced a measure designed to close income tax loopholes against Canadians who are trying to circumvent the country?s tax laws.

His rule, if adopted, would apply mostly to non-resident trusts and foreign investment entities.

Mr. Flaherty said the measure would, ?help ensure that income earned by Canadians through foreign jurisdictions, including tax havens, is subject to tax as if it had been earned in Canada?.

The latest move from the finance committee increases the likelihood of some kind of change to tax law before the 2007 fiscal year which begins in April.

Changes could involve individual Canadian taxpayers, corporate Canadian taxpayers, or both.