Court strikes down Valdez tanker tax

WASHINGTON, June 15 (UPI) -- The U.S. Supreme Court ruled 7-2 Monday to strike down a Valdez, Alaska, tax on large oil tankers as unconstitutional.

Valdez imposes the personal property tax, principally on large oil tankers, including those of Polar Tankers Inc. Polar's vessels transport crude oil from the Port of Valdez -- the end point for the Trans-Alaska pipeline -- to refineries in other states.

The company challenged the tax in state court, saying the U.S. Constitution bans a state to "lay any duty of tonnage" without the express consent of Congress, and saying aspects of the case violated other constitutional guarantees.

Eventually, the Alaska Supreme Court upheld the tax, finding it was a property tax not a tonnage tax.

Monday, the U.S. Supreme Court majority disagreed.

In an opinion joined in whole or in part by six other court members, Justice Stephen Breyer said the tax tries to do indirectly what is forbidden -- impose a tonnage tax. Breyer and the six other justices joined in the judgment, reversing the lower court and sending the case back down for a new ruling based on Breyer's opinion.

Two justices dissented.

(Polar Tankers vs. Valdez, No. 08-310)