It could also lower "non-tariff" barriers such as some health and safety regulations, which hinder foreign businesses without formally penalising them.
"Based on our work thus far, the co-chairs of the High Level Working Group believe that a comprehensive transatlantic trade and investment agreement, if achievable, is the option that has the greatest potential for supporting jobs and promoting growth and competitiveness across the Atlantic," the report said.
The two sides should also seek to create "a more integrated transatlantic marketplace" by addressing issues arising from things like technical regulations and conformity assessment procedures, and by early consultation on regulations.
The report called on officials and businesses in both blocs to present concrete proposals by the end of the year to ease the regulatory differences that impede change.
"We are now entering the last leg of mapping out how we should tackle any eventual negotiation to boost growth and jobs through our trade partnership," EU Trade Commissioner Karel De Gucht said in a statement.
A trade-driven boost to economic growth and confidence would help both Obama, campaigning to be re-elected in November, and EU leaders, who are struggling with a financial crisis and near-zero growth.
Still, U.S. and EU officials worry about launching negotiations that could drag on for years without success, such as the Doha round of world trade talks, which started in 2001 and never reached an agreement.
Peter Rashish, vice president for Europe and Eurasia at the U.S. Chamber of Commerce, said he was encouraged by the report even though the two sides noted some worked remained on difficult issues before negotiations can be launched.
"My best guess is they are talking about some agriculture and regulatory issues. We've always thought those could be the most challenging, but I think the tone of the whole report is that these can be done. So I think we're on the right path," Rashish said. (Reporting By Sebastian Moffett in Brussels and Doug Palmer in Washington; Editing by Roger Atwood)