The outcry in the United States Congress and news media over companies moving to Bermuda to cut tax bills could make more companies decide to move to Bermuda, according to a leading analyst.

Lehman Brothers Inc. tax strategist Robert Willens said Tuesday that the rumpus being caused by US companies seeking to re-domicile in Bermuda and the intense focus touched off by the Stanley Works' vote to move has not necessarily worked against reincorporations.

He said: "Ironically, the publicity has made more people aware of the benefits of the strategy."

He added that heightened awareness would "cause more and more companies to seriously consider expatriating", assuming no legislation was passed in the meantime.

On Tuesday, a move to halt US companies moving to Bermuda to lower tax bills was put before Congress for vote for the first time, but did not get past the starting blocks. The bill, sometimes called the Patriot or Repo Act, was piggybacked on to another piece of legislation to give tax relief to married couples in a bid to get it passed before the end of session.

But the bill was thrown out and the marriage tax relief bill postponed until next week when it will be put forward again.

All this year newspapers in the United States have been running with the story of allegedly unpatriotic US companies reincorporating to save on their tax bills.

On Tuesday both Cooper Industries and Leucadia National voted to reincorporate in Bermuda, adding fuel to the fire burning in the United States.

The US is currently one of a handful of countries that taxes on foreign-sourced income, and companies argue that in the global economy this makes them un-competitive and there is a need to move to a more tax friendly environment.

Companies say they can reduce their tax costs from about 35 percent to between 25 and 20 percent by moving to more tax-friendly environments like Bermuda.

The New York Times, AP, Reuters and others such as the Houston Business Journal, have all expressed outrage at the proposed or actual moves.

Earlier this month AP said: "US companies are scrambling to complete tax-cutting relocations of corporate headquarters to offshore sites as momentum builds in Congress to stop the trickle before it becomes a flood."

Momentum has been building in the United States to put in place controversial laws that will stop the flood of companies leaving the US for tax-friendly Bermuda.

Last month lawmakers vowed to push for legislation that will halt companies reincorporating in tax friendly locations like Bermuda, dubbing it the "Repo Act". It has also been called the Patriot Act or Tax.

The Senate Finance Committee leaders said they would aggressively press for legislation that stops US companies from moving their headquarters overseas to cut taxes.

"Our legislation ... is designed to put the brakes on the potential rush to move US corporate headquarters to tax havens," said panel chairman Max Baucus, of Montana who along with Charles Grassey of Iowa is spearheading the campaign.

This year alone US legislators have introduced two bills to the House of Representatives aimed at stopping US companies from relocating offshore, particularly to Bermuda.

The bills have been proposed by by Rep. Richard Neal and Rep. Scott McInnis and several American legislators have indicated they will put forward further bills, including Sen. Paul Wellstone and Sen. John Kerry.

In essence, the bills aim to levy US taxes on all income - including foreign revenues and sales - earned by corporations that reincorporate outside of the US. The debate has largely focused on Bermuda-based companies such as Tyco, Global Crossing, Ingersoll-Rand and a company which has not yet "redomesticated", Stanley Works.

The US toolmakers held a vote last week to move to Bermuda, but the "yes" shareholder vote has been questioned and will be done again as pressure mounts for them to stay in the states. Weatherford International Ltd and Nabors Industries also announced plans to move to Bermuda to save taxes.

Sen. Baucus said he plans to bring the bill up for a vote soon and added he was "quite confident" the legislation could be passed into law this year to reduce occurrences of the practice.