United Parcel Service Co. v. State, Department of Revenue

OPINION

BRYNER, Justice.

I. INTRODUCTION

United Parcel Service Company, an air carrier, used 17,611,870 gallons of jet fuel on domestic flights departing Anchorage but filed Alaska tax returns reporting only 2,159,721 gallons as taxable-the fuel that its flights consumed in Alaska. The state assessed taxes for the total fuel used. Appealing this assessment, UPS insists that Alaska's Motor Fuel Tax Act 1 taxes only "fuel consumed." Since "consumed" ordinarily means "burned," UPS argues that it owes taxes only for fuel actually burned in Alaska. We affirm, holding that although the act taxes jet…