Advisory Commission On Electronic Commerce Arrives At Majority Position On Internet Taxation Issues At Final Meeting In Dallas

Dallas, Texas - March 21, 2000 - The Advisory Commission on Electronic Commerce today closed out its final meeting returning a majority decision on providing direction to Congress on Internet tax issues. Under the proposal, the Commission voted to:

• Reduce consumers' taxation burden by repealing the federal three-percent excise tax on telecommunications services
• Forge a meaningful pathway to simplification of states' sales and use taxation systems
• Permanently prohibit states or localities from taxing Internet access subscription charges
• Extend the current Internet Taxation moratorium legislated by the Congress on multiple and discriminatory taxation

In addition, the Commission voted to clarify nexus standards that impact the obligation of businesses to collect and remit state and local taxes on remote transactions. Further, the Commission highlighted the need to bridge the "Digital Divide" to permit all Americans to participate in the Internet economy.

Addressing privacy concerns, the Commission noted that any tax administering system for e-Commerce should be developed in a manner that minimizes disclosure of consumers' personal information, and should contain sufficient security to protect that information. The Commission recommended that the appropriate committees of Congress should explore privacy issues associated with the collection and administration of taxes on e-commerce.

"I am pleased that we were able to come to a majority decision on these key public policy issues," said Virginia Governor and Commission chairman, James S. Gilmore. "The Commission's final report will provide an invaluable resource to the Congress as it deliberates key Internet questions. These issues will have a profound impact on every citizen of our country. Along with my fellow Commissioners, I am grateful to have had the opportunity to serve on this distinguished panel."

The Commission also voted to afford each Commissioner the opportunity to submit their distinct views on e-Commerce taxation issues. These inputs will be incorporated in the Commission's final report to Congress.

For more information about the meeting and the Commission, the public may visit the Commission's Web site at http://www.ecommercecommission.org.

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.