Space is a new frontier of commercial activity. Companies now launch satellites for profit. Others seek to travel to the moon, Mars, and beyond perhaps for both exploration and potential business opportunities. But the questions of taxation of space derived income is still somewhat open. In On Sovereignty, Outer Space, and Taxation, 104 Neb. L. Rev. ___ (2026), Erika Isabella Scuderi argues that while there are numerous questions about sovereignty in outer space and what constitutes "outer space" or a "space activity," providing tax jurisdiction based on registration works effectively. The article also situates itself within broader discussions of space law, international law, and taxation.

Scuderi starts with a discussion of the related law of airspace and aircraft. She introduces three key types of jurisdiction: (1) territorial jurisdiction, the jurisdiction a state has over the air above its territory; (2) quasi-territorial or functional jurisdiction, where the state of aircraft registration has jurisdiction over the instrument and the people on the instrument; and personal jurisdiction, where the state has jurisdiction over its nationals. Territorial jurisdiction trumps quasi-territorial, which trumps personal jurisdiction.

The Cold War space race spurred the creation of the Outer Space Treaty. The treaty established that outer space is the “province of all mankind.” Thus, no state has full territorial jurisdiction over any part of outer space or celestial bodies. 

But that does not mean that outer space is a lawless void. First, Article II of the Outer Space Treaty requires that a state that launches a space object is required to register that object. That state then has quasi-territorial jurisdiction over the object and its contents per Article VIII of the Outer Space Treaty. States still have personal jurisdiction over their nationals, and the hierarchy still applies. Thus, there is a functional framework where the launching state serves as the state of registration, which in turn has quasi-territorial jurisdiction over the object and its contents.

Tax flows from these jurisdictional ideas, but it does not perfectly map onto it. In tax law, if a person is a national or resident of a state, that state has full fiscal power over all the income of that person. On the other hand, when there is a nonresident, a state only has taxing powers to income sourced in the state’s jurisdiction. 

These principles get more complicated though with air and sea transportation. Scuderi’s analysis of this area provides the analogy for space taxation. Residence states have full taxing rights on the activities of ships and aircraft that are owned by entities or people in the states or are registered in that state. If the craft is in the territorial waters or airspace of a state, that state can tax the employment income on a source basis. But in international waters and airspace, the income links to the jurisdiction of the ownership or registration of the ship or aircraft. 

All of outer space resembles international waters and airspace. But Articles II and VIII work together to grant the state where the space craft is registered quasi-jurisdiction over the craft and its contents. Furthermore, the state where someone launches the space vessel is the registration state.

Thus, tax jurisdiction over space-derived income should fall under the fiscal power of the state of registry. This “Tax Jurisdiction by Registration” principle flows logically from the structure of underlying international law in the Outer Space Treaty. Furthermore, unlike ships on the seas, it is harder to create flags of convenience, because only a few places are competent to host launches.

Scuderi’s principle addresses key tax scenarios in space. If the registration country and the residence country are the same, then such income is domestic sourced. If the registration country is different, it is foreign sourced. That generally works, unless a country has a strong force of attraction law that treats space income as domestic income for a resident taxpayer, even if the object is registered elsewhere. If that is the case, there could then be double taxation, as the registration country could tax the income and the resident country could also tax that same income, and both would be source countries. Tax treaties could provide help. Finally, it is unlikely that the space object serves as permanent establishment under the traditional rules, but with the shift in that idea in the digital age that may get undermined.

Scuderi’s work is important, because it unifies different parts of international law with taxation on an increasingly pressing issue. The tax jurisdiction by registration approach provides a useful starting point for determining who can tax income derived from space activities. Rather than throwing our hands up because space falls under no one’s jurisdiction, the framework establishes a principled foundation.

Additionally, the work shows how space and earth are linked. It points to how shifting norms and understanding here on the ground, like the ideas of permanent establishments, may also shift what happens to taxation in the heavens. And certain changes here on earth, in terms of tax notions or technology, may also require new thinking in space, not just in the realm of taxation, but overall, in how we handle outer space.

This piece makes a valuable contribution to an underexplored area. The "Tax Jurisdiction by Registration" principle offers a practical solution grounded in existing international law frameworks. While questions remain about implementation details and potential conflicts, Scuderi provides essential groundwork for future space taxation discussions. The work's strength lies in its systematic approach. It builds from established airspace and maritime precedents to develop space-specific solutions. As commercial space activities accelerate, this foundational analysis becomes increasingly relevant for tax practitioners and policymakers. The article opens doors to further generative discussions in tax and space law, recognizing that our cosmic ambitions cannot escape earthly fiscal realities.