JetBlue Fails to Take Down Florida’s Airline Income Tax Formula

JetBlue Airways Corp. is on the hook for a $630,000 Florida corporate income tax bill after a judge upheld the state’s method for determining how much of an airline’s business is taxable.

Florida determines an airline’s taxable income by dividing the number of miles it carries passengers within the “Florida box"—a geographical area statutorily defined by latitude and longitude—by the miles it carries passengers everywhere. JetBlue argued that box includes international waters and portions of other states where Florida has no authority to tax, so the method violates of the US Constitution’s commerce clause.

“Florida’s income tax applied to 7% ...