Best of TaxLetter: It's Constitutional

The Supreme Court declared the Windfall Profits Tax constitutional. A District Court decision had ruled it unconstitutional because it exempts oil produced in Alaska, while the Constitution requires that taxes be uniform throughout the U.S.

The term "exempt Alaskan oil," the Supreme Court declared, really means oil produced in certain arctic and subarctic regions. The exemption applies to all states with oil producing territory in those regions, not just Alaska. Lucky the Court decided this way. Otherwise, Treasury would have to refund $30 billion and lose billions more in future revenues. (No. 39)