Aviation Fuel Tax History 

1966: "An excise tax is hereby levied upon the use, distribution or sale within the 

Trust Territory of all gasoline and diesel fuel at the rate of five cents per gallon so 

used, distributed or sold." 77 TIC§ 101(2). Does not distinguish between aviation 

and non-aviation fuel. 

March 24, 1976: Covenant goes into effect, replacing Trust Territory government 

with Commonwealth government: 

(a) The Government of the United States may levy excise taxes on goods 

manufactured, sold or used or services rendered in the Northern Mariana 

Islands in the same manner and to the same extent as such taxes are 

applicable within Guam. 

(b) The Government of the Northern Mariana Islands will have the authority 

to impose excise taxes upon goods manufactured, sold or used or services 

rendered within its territory or upon goods imported into its territory, 

provided that such excise taxes imposed on goods imported into its territory 

will be consistent \vith the international obligations of the United States. 

Covenant, § 604. Trust Territory tax law remains in effect. Covenant, § 505. 

May 27, 1982: "For the privilege of f~.rst selling, using or distributing aviation gas or 

other aviation fuel imported into the Commonwealth, there is hereby imposed an 

excise tax at the rate of three percent (3%) ad valorem. The Director of Finance may 

reduce or waive by regulation the aviation fuel tax upon an airline upon finding that 

the airline will increase its flight schedule into and \vithin the Commonwealth to a 

level resulting in benefits to the Commonwealth in excess of the loss of revenue 

under this section." PL 3-11 § 403(b). Tax goes to the general fund. 

December 30, 1987: 49 U.S.C. § 47107(b) cut-off date. 

January 24, 1995: Tax amended: "For the privilege of fLrst selling or distributing 

aviation gas or other aviation fuel in the Commonwealth, there is imposed an excise 

tax at the rate of three percent (3%) ad valorem." PL 9-22 § 1 (1403(b)). "The 

Secretary may by regulation reduce or waive the fuel tax imposed under§ 1403 

where ... the price of aviation fuel without the aviation fuel tax would be more 

competitive than the price of aviation fuel elsewhere and the airline would purchase 

the aviation fuel in the Commonwealth." PL 9-22 § 1(1404(a)). 

February 16, 1999: FAA issues Policies and Procedures Concerning the Use of 

Airport Revenues (Reven ue Use Policy). 64 FR 7696. 

July 23,2002: New section provides: 

After rS2,000,000 worth of non-aviation fuel taxes have] been transferred, 

and notwithstanding any law to the contrary, beginning October 1, 2001 and 

annually thereafter, the Department of Finance shall deposit the balance 

amount o f the liquid fuel tax collected under 4 CMC § 1403(a) and the entire 

amount of the aviation tax coflet'led under4 CMC § 1403(b) into the Land 

Compensation Fund. Such funds shall be continually appropriated to the 

Marianas Public Lands Authority for the sole purpose of paying the principal 

and interest on any financing authorized by this Act. Provided, that, in the 

event the amount in the Land Compensation Fund is insufficient to cover 

any requisite payment, the Governor is hereby authorized , notwithstanding 

any contrary law, to pay the remaining balance from the general fund. The 

funds in the Land Compensation Fund shall be nonlapsing, except, upon 

certification by the Secretary of Finance that all principal and interest on all 

financing has been paid in full and discharged, any funds remaining in the 

Land Compensation Fund shall lapse to the general fund. 

PL 13-17 § 5. (emphasis added). Land Compensation Fund used to pay a bond. PL 

13-17 §§ 3-4. 

September 20, 2002: 

After [$2,000,000 worth of non-aviation fuel taxes have] been transferred, 

and notwithstanding any law to the contrary, on or before October 1, 2002 

with :MPLA securing the $40,000,000 mandated by PL 13-17, as amended, 

and annually thereafter, the Department of Finance shall deposit the balance 

amount of the liquid fuel tax collected under 4 CMC § 1403(a) and tbe entire 

amount of the aviation tax c·ollec'led 11tlder4 CMC § 1403(b) into the Land 

Compensation Fund. Such funds shall be continually appropriated to the 

Marianas Public Lands Authority for the sole purpose of paying the principal 

and interest on any financing authorized by PL 13-17, as amended. Provided, 

that, in the event the amount in the Land Compensation Fund is insufficient 

to cover any requisite payment, the Governor is hereby authorized, 

notwithstanding any contrary law, to pay the remaining balance from the 

general fund. The funds in the Land Compensation Fund shall be nonlapsing, 

except, upon certification by the Secretary of rinance that all principal and 

interest on all financing has been paid in full and discharged, any funds 

remaining in the Land Compensation Fund shall lapse to the general fund. 

PL 13-25 § 1(2) (emphasis added). The only change is the date when the tax begins 

to be transferred. 

December 13, 2002: 

After [S2,000,000 worth of non-aviation fuel taxes have] been transferred, 

and notwithstanding any law to the contrary, and beginning when the 

Commonwealth initially obtains the interim or other financing authorized by 

this Act, the Department of Finance shall deposit the balance of the amount 

of the liquid fuel tax collected under 4 CMC § 1403(a) and the entire omoHnl of 

the aviation tax colleded under4 ClvlC f 1403(b) into the Land Compensation 

Fund to the extent necessary to maintain a balance in such rund at all times 

sufficient to pay all principal of and interest on the bonds becoming due 

during the next succeeding 12 months. Such funds are continually 

appropriated for the sole purpose of paying the principal and interest on any 

financing, including any interim financing, authorized by this Act. Provided, 

that, in the event the amount in the Land Compensation fund is insufficient 

to cover any requisite payment upon such financing, the Governor shall, 

notwithstanding any law to the contrary, pay the remaining balance of such 

payment from the general fund. The funds in the Land Compensation Fund 

shall be nonlapsing except, upon certification by the Secretary of Finance that 

all principal and interest on all financing has been paid in full and discharged, 

any funds remaining in the Land Compensation Fund shall lapse to the 

general fund. 

PL 13-39 § 4 (emphasis added). Authorizes use of the Land Compensation Fund for 

interim financing. 

October 21, 2004: Land Compensation Fund provisions repealed and re-enacted 

without changes. PL 14-35 § 4(1804).