ALTHOUGH there are many off-shore domiciles offering tax shelter to US companies, Bermuda is being targeted because of the size of the corporations it attracts, according to Arianna Huffington, co-founder of The Bermuda Project, now lobbying to crack down on "corporate fat cats" who relocate overseas to avoid taxes.

"Although, we admit, there are so many other places," she said, "a lot of the big companies are in Bermuda so it is the most identifiable place, in the public's mind.

"These companies enjoy America's many freedoms but don't want to pay their fair share to support schools, law enforcement, and homeland security."

The Greek-born Huffington is a syndicated conservative political columnist, TV commentator and author and is often referred as the glamour girl of the Republican right-wing.

"These firms are deserting the country for Bermuda's beaches even as our young men and women are putting their lives on the line in Iraq's deserts," she told the Mid-Ocean News from her Santa Monica, California office yesterday. "They are cheating America, and they are cheating every American taxpayer who plays by the rules."

Launched earlier this month in Washington, DC, the lobby group's campaign is to include a series of television advertisements as well as an online mobilisation of Americans through MoveOn.org - a network of more than 1.3 million online activists - and Working Assets, another powerful network with more than 700,000 members.

Through online petitions and organised events, each will provide a platform through which Americans can let corporations operating in so-called tax havens, and members of congress, know what they think of that practice.

Planned to run in several markets, the group's television advertisment contrasts businessmen in suits on a tropical isle, with the images of soliders in Iraq, while an accompanying voice-over states:

"In the sands of Iraq, our soldiers risk their lives for our country. At the same time, big corporations are abandoning our country and setting up phony tax shelters in the sands of Bermuda."

Areas particularly targeted by the ads are Washington, DC and the home districts of House Majority Leader Tom Delay of Texas and Speaker, Dennis Hastert of Illinois, both of whom, according to The Bermuda Project are refusing to allow a vote on the Corporate Patriot Enforcement Act - legislation aimed to crack down on tax shelters and which, the group believes, would pass overwhelmingly if allowed to come to the floor.

"Across America, teachers, firefighters, police officers and others are feeling the squeeze," said Robert Borosage, co-director of the Institute for America's Future and co-founder of The Bermuda Project.

"At the same time, Republican leaders in Congress are blocking a vote on legislation that could recover billions of dollars a year from expatriate tax dodgers. Something is profoundly wrong with this picture."

In addition to Bermuda, countries considered to be tax havens include Anguilla, the Canary Islands, Guernsey, Monaco, St. Kitts-Nevis, Andorra, the Cayman Islands, the Isle of Man, Montserrat, St. Lucia, Antigua, Jersey, Nauru, St. Vincent and the Grenadinesn, Bahrain, the Bahamas, Liberia, the Netherlands Antilles, Tonga, Barbados, Dominica, Liechtenstein, Niue, Turks and Caicos, Cook Island, the Maldives, Panama, the US Virgin Islands, Gibraltar, Marshall Islands, Samoa, Vanuatu, the British Virgin Islands, Grenada, Mauritius and the Seychelles.

It is alleged that such shelters cause the United States to lose around $70 billion in unpaid taxes each year. The issue was the topic of this week's Democratic weekly address when Richard Neal, a senior member of the House Ways and Means Committee, launched an attack on corporate expatriates.

In the address, the Massachusetts Democrat cited the example of one company that paid $28,000 to rent a mailbox in Bermuda to avoid a $40 million tax bill. He would only describe the corporation by saying that its jackhammers carved Mount Rushmore.

Pressure to stem the flow of US companies incorporating in Bermuda mounted last year in light of the Americans' expensive war on terrorism and the ensuing "patriotism versus profits" argument.

However, the National War Tax Resistance Co-ordinating Committee this week estimated that as many as 8,000 Americans avoid paying some or all of their federal income tax liability because of their political beliefs, many because they don't want their money supporting the US military.

Acting Minister of Finance Paula Cox (pictured)addressed the issue in a press statement earlier this week.

"The Ministry of Finance continues to initiate and to assess issues with regard to Bermuda and how it is portrayed abroad," she said. "The timing of the Bermuda Project group is interesting given that already both tax committees of the US Congress last week passed inversion provisions in energy tax legislation.

"Further, the House Ways and Means Committee passed a proposal for a moratorium on inversions from March 4, 2003 until January 1, 2005.

"The Government continues to monitor these and other initiatives and recognises that the issues surrounding corporate inversions remain fluid. It should be noted that though the Ministry continues to monitor the position and keep the situation under active review and liaises with our overseas lobbyist routinely in this regard, we note that this is not the mainstay of Bermuda's international business."

Some $107,000 had been provided in this year's Budget, she added, to safeguard Bermuda's economic interests in the face of such challenges and threats.