Clinton is through Foreign Sales Corporations (FSCs).

The budget proposes to extend the benefits of the foreign sales corporations rules to computer software licensed for reproduction abroad. The change, which apparently enjoys bipartisan support in Congress, would be effective for licences granted after the date of the enactment of the spending package.

US tax specialist at Ernst & Young in Bermuda, Patrick L. Hackenberg, said, "The Bermuda budget is coming up February 19. The Finance Minister, Grant Gibbons, has already said that he is in favour of reducing the annual fees for these foreign sales corporations in Bermuda. So we should seeing an increase in FSCs in Bermuda.

"But this is a double bonus because Bermuda wants to be seen as a technological centre and that is exactly what this provision in the US budget is aimed at.''