United Air Lines, Inc. v. Mahin

The Illinois use tax was applied to appellant's aviation fuel stored in the State and loaded aboard its aircraft there and consumed in interstate flights, the tax authorities having revised their previous "burn off" interpretation of a statutory exemption for temporary storage. Under the "burn off" interpretation only fuel consumed in flight over Illinois was used to measure the tax imposed for storage before loading, but under the reinterpretation all fuel loaded was deemed to measure the tax on the "use" of storage or withdrawal from storage. The Illinois Supreme Court upheld the statute against appellant's contention that the tax as reinterpreted impermissibly burdened interstate commerce.

Held:

1. The statute as authoritatively construed by the State's highest court to tax storage and not consumption does not place an unconstitutional burden on interstate commerce. Edelman v. Boeing Air Transport, Inc., 289 U.S. 249; Nashville, Chattanooga & St. Louis R. Co. v. Wallace, 288 U.S. 249. Cases allowing the taxation of storage of fuel before loading have not outlived their usefulness. Pp. 626-630.

2. The "burn off" rule is not unconstitutional, being distinguishable from a tax imposed on consumption such as was invalidated in Helson v. Kentucky, 279 U.S. 245. Since some of the Illinois Supreme Court majority were under the mistaken impression that Helson precluded use of the "burn off" interpretation, the case is remanded to enable that court to construe the temporary-storage provision under state law free from any constraint that such interpretation would not be constitutionally permissible. Pp. 630-632.

49 Ill.2d 45, 273 N.E.2d 585, vacated and remanded.

BLACKMUN, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, MARSHALL, POWELL, and REHNQUIST, JJ., joined. DOUGLAS, J., filed a dissenting opinion, in which STEWART and WHITE, JJ., joined, post, p. 632. WHITE, J., filed a dissenting opinion, post, p. 639.

Mark H. Berens argued the cause for appellant. With him on the briefs were H. Templeton Brown, Robert L. Stern and William Bruce Hoff, Jr.

Robert J. O'Rourke argued the cause for appellees. With him on the brief were William J. Scott, Attorney General of Illinois, and Warren K. Smoot and Calvin C. Campbell, Assistant Attorneys General.^[1]