As Tax Complexity Builds for Companies Using the Internet, Deloitte &Touche Names Global Leader for e-Business Tax Services.

Business Editors &High-Tech Writers

SAN JOSE, Calif.--(BUSINESS WIRE)--Feb. 10, 2000

Martin R. McClintock has been named Global Director, e-Business Tax Services, after serving as leader of the international tax practice for Northern California, Hawaii and the Pacific Northwest of Deloitte &Touche LLP. McClintock has been with Deloitte &Touche for 20 years, including four years with the firm's Tokyo office, where he served as the lead technical liaison and international tax partner for several of the firm's largest strategic clients. He has extensive experience in the high-technology industry and has advised many well-known companies in the field with issues ranging from transfer pricing to mergers and acquisitions and international restructuring.

&uot;Marty McClintock is well positioned to lead the firm's efforts in addressing the increasingly complex tax issues that have evolved around the explosive growth of companies engaged in e-commerce,&uot; said Jerry Leamon, Global Managing Partner, Tax and Legal Services. &uot;He also will play a pivotal role in assisting more established companies that have created dot-com businesses and businesses that are conducting a significant proportion of their procurement and distribution on-line.&uot;

&uot;As companies engage in more business over the Internet, their economic characteristics do not always fit neatly into the pigeonholes that our tax laws have established,&uot; McClintock said. &uot;Since our tax laws do not change as rapidly as e-commerce changes, tax planning within these companies must be flexible enough to evolve. Our aim is to help our clients become more agile in dealing with their tax needs and take advantage of tax strategies that fit their unique situation.&uot;

According to McClintock, companies engaged in e-commerce face a myriad of tax issues that are relatively new, including:

     -- A much greater administrative burden: With 30,000 taxing
        jurisdictions, there are as many as 6,500 different tax forms
        in the United States alone. Internationally, more than 200
        countries impose direct and indirect taxes.

     -- An understanding of the Internet Tax Freedom Act (ITFA).
        Although the ITFA, passed by Congress in October 1998,
        provides for a three-year moratorium on new state taxes on
        Internet access charges and on other forms of taxation, not
        all transactions conducted over the Internet are &uot;tax free.&uot;

     -- Knowledge of a company's nexus -- the degree of business or
        physical presence in a tax jurisdiction required before a
        state or local taxing authority can tax a business or require
        it to collect tax. Avoid being ensnared in unnecessary tax
        liabilities by establishing operations in cyber-friendly
        states.

     -- Careful consideration of the tax implications of a company's
        e-business strategy before finalizing and beginning the design
        and implementation phases.

     -- Planning now for international tax liabilities if going global
        is a company's goal, including customs duties, value-added
        taxes and other taxes wrought by e-business, in addition to
        the costs associated with managing the legal and financial
        requirements.

Deloitte &Touche, one of the nation's leading professional services firms, provides assurance and advisory, tax, and management consulting services through 30,000 people in offices in more than 100 U.S. cities. Deloitte &Touche is part of Deloitte Touche Tohmatsu, a global leader in professional services with more than 90,000 people in more than 130 countries.

Deloitte &Touche refers to Deloitte &Touche LLP, Deloitte Consulting LLC, and related entities. For additional information, visit Deloitte &Touche's Web site at www.us.deloitte.com.