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New York state governor tries to tax tribal sales on the reservations

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Old 12-27-2008, 03:05 AM
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Thumbs down New York state governor tries to tax tribal sales on the reservations

Paterson looks to tribal sales to help solve deficit by Tom Precious at the Buffalo Sentinel Periodical services

Amazing what a $15.4 billion budget deficit will do.

Just months ago, Gov. David Paterson was pushing off calls that he try to collect taxes on cigarettes sold by Indian retailers. The better way is to negotiate with the Indian tribes, he said, a course taken, and failed, by three governors before him.

So Monday in Utica, just 24 hours before unveiling his plan to solve the state's budget crisis, Paterson signed a bill that he says will have the state collect the cigarette taxes. Today, he will reveal how much he expects the state to make this year from the tax collection efforts in the way of new cigarette excise taxes.

That he chose Utica to sign the bill Monday was noteworthy, all sides agreed. Native Americans saw it as an in-your-face move. He could have just put out a piece of paper announcing his signature on the bill. Instead, he traveled to central New York - a hotbed of anger over the years between Native Americans and non-Indian residents over a range of sovereignty issues - in front of an audience of local politicians with low standing among many Indians in the region. "Why did he do it that way?" one upset Seneca said Monday.

This from a governor who still talks of wanting to negotiate with the Indians on the tax matter.

Naturally, there is skepticism about the latest effort. Tax collection advocates have heard governors before say they will stop the tax-free sales. And nothing has happened since the state won a landmark United States Supreme Court case in 1994 giving it the legal right to collect the tax.

Moreover, there's the matter of likely additional litigation that will delay the collection efforts.

New York might have a better clue of Paterson's intentions in 60 days. That is when the new law he signed Monday becomes effective.

--- Tom Precious
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Old 12-27-2008, 10:26 PM
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Thumbs up Thoughtful and Educational answers to New York state governor...


Tom makes some solid points of distinction for the Haudenosaunee from those Native entities in the states out west. Again it is important to recognize that nothing is granted to us interms of our sovereignty in any treaty. These treaties all took more than they gave, but they all continued to recognize the autonomy and independence of our people and our lands. A few other points worth mentioning include the status of our land. Unlike our brothers out west, we have absolute title to our lands. Our lands were not set aside for us or established by treaty or some federal land trust process. We own it and the U.S. has vowed repeatedly to "never claim the same". Another point is that the Haudenosaunee rejected the Indian Reorganization Act. Even the Senecas with a written constitution rejected this attempt to model our governmental structures into something that fit into a better box for the U.S. branches of government to deal with. In addition our interaction with the BIA is almost nonexistent. Even when called upon by federal statute the Bureau is mostly a no-show. Take the Seneca Gaming compact; The BIA chose not to reject or approve the agreement and simply let it go into affect by default. Another significant point that must be noted is where our sovereignty is vested. The concept of being a servant of the people is uniquely Haudenosaunee. Americans use the words but miss the meaning. Those that bear a title in our territories are not the Sovereigns. They are not kings or lords and they do not lead the blind masses. Our sovereignty is vested in the people. Even the Seneca Nation with its three page written constitution yields very little responsibility to its elected officials. Our democracy is not defined by an election or even a Grand Council; on some occasions it may be played out by the people on the Thruway. Before anyone condemns our actions as crude, primative or violent ask yourself; how is your sysytem working? Where is the great governor that you elected? And what caused the greatest changes in American history? Was it your smooth democracy? What about your assasinations, wars, economics collapses, protests and riots?

Posted by: John | December 27, 2008 at 09:44 PM


The Moe and Colville decisions are not determinative of New York's present attempt to compel the Haudenosaunee Nations to act as tax collection agents for the State of New York. The Indian Nations involved in the Moe and Colville cases did not raise a treaty-based defense to the state tax collection schemes implicated in those cases. Instead, the Indian Nation parties only claimed that certain federal statutes pre-empted the state action and that the state regulations were invalid under the "negative implications" of the Indian Commerce Clause. Because the ultimate holdings in Moe and Colville had nothing to do with the interpretation or application of Indian treaties to a state tax collection scheme, Moe and Colville are neither relevant to, or determinative of, New York's latest attempt to require Haudenosaunee Indian Nations to act as tax collection agents.

Nick, I don't want to misinterpret what you are saying, especially since the point you make appears to overarch your entire argument; but are you suggesting that the United States Supreme Court has already decided the meaning of the free use and enjoyment language of the Canandaigua Treaty? If this is what you are saying, what decision in particular are you referring to?

On Monday, Justice Sconiers issued a temporary restraining order which effectively precludes the State of New York from enforcing the Bill recently signed by Paterson. While I can't speak for Justice Sconiers, I am certain she recognized that the new scheme is somehow defective under New York law. I draw this conclusion because I know the parties who opposed the new Bill did not object to it on the basis of any treaty.

To address your "question of what the Governor should do", I recommend that New York should do a much better job communicating with its residents concerning their cigarette use tax reporting and payment obligations (see my earlier comment).

Posted by: Tom Moll | December 27, 2008 at 06:12 PM

Mr. Paterson, you should be ashamed of yourself. I can appreciate that you were not elected into the position you now hold, but don't be so limp about it. You are a blind, black man that managed to become the governor of New York State. How could you crumble into being the legislature's lapdog? Did somebody tell you that the State's checks and balance system disappeared when you took the oath?
There is a reason that most Native territories within the State won't sit to negotiate a "deal" like other states have with their Indians. We aren't your Indians. We will not allow you to take anymore from us. We stopped being pushed around by New York over thirty years ago. Hell, we pushed back against Rockefeller on I 81. Only Attica prevented a major conflict between us. We fought to carve out a small piece of the tobacco trade; a trade we originally developed through respectful cultivation, incorporation into our customs and trade with other nations centuries before the white man prostituted our sacred medicine. We are not going to dance for you on this. We are in this business to stay.
Even if you illegaly stop finished products from making it to our territories for resale we have enough Native manufactured product to carve out a significant business. Perhaps you are doing us a favor by drawing the line in the sand. I believe we can take more market share from big tobacco so more of our revenue stays at home. Of course you will lose more MSA funds but hell, this isn't about money any way. Right? It is about your concern for the public health and safety. You certainly would not try to use a public vice to raise money for the State budget; oh yeah there is that "Crack Draw" thing you want to expand and the increase on tax of alcohol. Maybe you and Elliot can figure a way to tax postitution. Just remember to pay your fair share and pay tax on all that you use and consume in the State.

Posted by: John | December 27, 2008 at 04:56 PM


Thank you for your response. Based on your post, I reviewed the definition of "Indian trader." Upon my initial read of the Attea case, I interpreted "Indian" as modifying "trader" (in other words, I interpreted it to mean a Native American owned business engaged in trade). Upon further review in the context of the Indian Trader statutes, I do see that that definition is incorrect, but it is properly defined as a trader licensed to deal with Indian tribes. I apologize for the confusion.

My initial incorrect definition notwithstanding, I still believe the conclusion that the U.S. Supreme Court believes requiring a Native American owned retailer to collect taxes as an agent of the state to be legal is correct. The Attea decision cites two other decisions (Moe and Colville) that are much more on point. A more careful read of Attea shows the decision to be largely based on the idea that as the state clearly could impose the regulatory requirement on a Native American retailer, it must be valid to impose it on a non-Native American wholesaler.

I do respect that the Haudenosaunee people, as a nation that believes itself to be sovereign, would not necessarily respect the interpretation of the U.S. Supreme Court of the Canandaigua Treaty of 1794 (or other treaties that may be relevant). The question at hand, however, is what should Governor Patterson do. While the Haudenosaunee may not respect the decision of the U.S. Supreme Court and may very well have their own interpretation of treaties, the Governor of the State of New York is without question obligated to respect the interpretation of the U.S. Supreme Court.

So, on the question of what the Governor should do, he has no choice but to enforce the law equally on non-Indian and Indian retailers alike.

If the question is whether the U.S. Supreme Court erred in Attea, Moe and Colville, that is a bigger question than New York politics and the protest and anger of the Native American tribes should be directed to the U.S. Supreme Court or the federal government more broadly and not at the State of New York which is only respecting its own Treaty obligations to the other 49 states (the U.S. Constitution viewed as a Treaty amongst the 50 states) to respect the decision of the U.S. Supreme Court.

As I see it, those objecting to the Governor's plan to collect the tax can be divided into three groups:

(1) those who are upset that their source of cheap cigarettes will be disturbed

(2) those who generally feel that New York has too many taxes and this is just another new tax

(3) those with genuine concern and respect for Native American sovereignty issues.

I have little sympathy for the first group (they really should just quit and save the rest of us their future Medicare bill)

The second group's efforts are misplaced in application to this narrow issue. If they believe the tax itself to be wrong, they should object to the tax, not the means of collection.

I have a great deal of respect for the third group, but believe the level of discourse needs to rise above the three words "Honor Indian Treaties." Let's talk about which treaties, what they say and how they are interpreted.

And lets recognize that a dispute over interpretation of a treaty is a dispute between sovereign governments and should be so handled with diplomacy. We could not imagine the Prime Minister of Canada leading public protests against the United States over a treaty dispute or lighting tires on fire to block the flow of traffic over the Peace Bridge. Continued in next reply or see trackback link
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indian tribes, native americans, new york cigarettes, paterson, supreme court case

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