On March 30, 2017, the District of Columbia Office of Tax Revenue withdrew its appeal, thereby conceding International Limousine Service, Inc.'s victory in a landmark decision by the D.C. Superior Court issued on October 27, 2016.
International Limousine contested a tax on trips made across state lines on the basis of a federal preemption that bars states from taxing the interstate transportation of passengers. The D.C. Office of Tax and Revenue argued that the tax should apply to trips made to area airports. Judge Christian, writing for the D.C. Superior Court Tax Division, held that the federal statute "acts as an absolute bar on the (District of Columbia's) authority to tax...transportation of passengers in interstate commerce."
The District of Columbia at first noted its appeal of this decision, but, upon further review, withdrew its appeal and conceded victory to International Limousine. The court's decision puts an end to years of unfairly imposed taxes upon ground transportation of passengers to airports like Reagan National, Dulles International, and Thurgood Marshall Baltimore-Washington International airports. In addition, transportation firms might be able to seek refunds for prior years in which the District of Columbia improperly imposed those taxes. The implications for the industry - and for the District - are considerable.