Advisory Commission on Electronic Commerce
Progresses Internet Tax Debate in San Francisco
Focuses on Consensus and Hard Deliverables

San Francisco, CA - December 14, 1999 - The Advisory Commission on Electronic Commerce, a congressionally-appointed 19-member commission tasked with studying the impact of federal, state, local, and international taxation and tariffs on transactions using the Internet and Internet Access, opened its third meeting in San Francisco today with discussions on international tax and tariff issues, as well as a review of proposals on "taxation" approaches to electronic commerce transactions submitted by members of the public. The proposals being considered include:

• "Internet Tax Elimination Act" -Mr. Chris Wysocki, president, Small Business Survival Committee
• "The E-Freedom Coalition's Proposal" -Mr. Adam Thierer, Walker Fellow in Economic Policy, Heritage Foundation, on behalf of the E-Freedom Coalition
• "A Uniform Jurisdiction Standard" -Mr. Dean Andal, California State Board of Equalization
• "A Prohibition on Discriminatory Ad Valorem Taxation on Interstate Telecommunications" -Mr. Dean Andal, California State Board of Equalization
• "Proposal for State and Local Taxation of the Telecommunications Industry" -Ms. Stacey L. Sprinkle, assistant vice president for tax, CommNet Cellular, Inc. and Mr. Keith G. Landry, general attorney, BellSouth, CommNet Cellular, Global Crossing, GTE, SBC, Sprint, US West, and Western Wireless
• "A Proposal for Fostering the Fast and Efficient Development and Operation of Internet Web Hosting Facilities" -Mr. John Morabito, vice president, Federal Legislative and Regulatory Affairs, Global Crossing, Ltd.

Advisory Commission Meets in San Francisco

On Wednesday, the Commission will hear additional presentations, followed by a discussion and debate of an Issues and Policy Options Paper. Generated by the Report Drafting Subcommittee, the Issues and Policy Options Paper identifies issues and presents options, objectively summarizing the various positions available to the Commission. The paper includes a distillation of discussions of the Commission's previous meeting, and considerable input from Commissioners. It consists of an introduction and notes, some areas of potential agreement that surfaced in the drafting processes, and the following seven sections:

• Internet Tax and Tariff Issues
• Tax Treatment of Internet Access
• Tax Treatment of Telecommunications Service Providers
• The Application of Transactions Taxes to Sales Conducted Through the Internet
• Impact on Business Activity Taxes
• Redress Mechanism for Imposition of Unconstitutional State and Local Taxes
• Digital Divide

"The Commission's objective is to debate the issues and provide recommendations to the Congress," said Virginia Governor, Jim Gilmore, chairman of the Commission. "In many ways, the Issues and Policy Options Paper is a summary of progress to date. A series of very real proposals is now on the table. We look forward to a substantive, productive meeting in San Francisco."

"The members of the subcommittee, with assistance from all Commission members, have worked tirelessly to draft this objective Issues and Policy Options Paper," said Robert Pittman, president and chief operating officer, America Online, and co-chairman of the Report Drafting Subcommittee.

The Commission's San Francisco meeting will be Web-cast both days via its Web site at http://www.ecommercecommission.org. Transcripts from the Commission's meeting will be posted on its Web site the week ending December 24.

The Commission will take its next full, face-to-face meeting in Dallas, March 20-21, 2000.

About the Advisory Commission on Electronic Commerce

Appointed by Congress in October 1998 as part of the Internet Tax Freedom Act, the 19-member Commission has been tasked with studying the impact of federal, state, local, and international taxation and tariffs on transactions using the Internet and Internet Access. The Commission's recommendations are due to Congress no later than April 21, 2000.