How to setup EBTax for Internet Expenses

 We move to R12 via a fresh install. The first company that we need to migrate uses Internet Expenses , in R11 the lines in the Expense Templates have different  taxcodes. I noticed that tax statuses setup in EBTax with 'available for internet expenses = y ' at rate level appear in the Expense Template. However the value entered there does not override the result of the rule.
Using a simple test setup at this time. two statuses STANDARD and ZERO , rule defaults to STANDARD , one line in TEMPLATE with STANDARD and other line with ZERO status but when imported in AP , both lines have STANDARD status/rate applied.