The president of a group of more than 200 CEOs has said that US President Barack Obama had told the business community last month he might back a territorial tax system, which would exempt offshore profits from taxation.

Corporate America is pushing for the United States to move to such a regime, which they say would make domestic business more competitive.

John Engler, president of the Business Roundtable, said that in meetings with Mr Obama during the budget standoff between the White House and Congress, the president left the impression he was moving in that direction.

"A favourable impression was left," Mr Engler said in a briefing with reporters.

A territorial system would exempt most domestic companies' offshore profits from US tax.

That contrasts with the worldwide system now in place, whereby all offshore profits are taxed when they are brought back into the United States.