United Air Lines, Inc. v. Johnson

This case involves the application of the use tax exemption provided by section 3(c) of the Use Tax Act (Ill. Rev. Stat. 1977, ch. 120, par. 439.3(c)). The specific question is whether an Illinois taxpayer who, by contractual agreement, pays an Indiana seller’s Indiana gross income tax liability (Ind. Code sec. 6 — 2—1—1 et seq. (1978)) resulting from the sale of fuel may claim an exemption from its Illinois use tax liability equal to the amount of the Indiana taxes paid. We hold that it cannot.

This litigation began in 1963 when United Air Lines sought to enjoin collection of the Illinois use…