Posted on 09/21/2003 4:44:20 AM PDT by Behind Liberal Lines
SYRACUSE NY--Native American nations across New York are gearing up to protest the state's latest effort to collect millions of dollars in taxes on cigarettes and gasoline sold to non-natives on Indian territories.
The Onondaga Nation will never collect a tax on cigarettes for New York, nation lawyer Joe Heath said, but it is willing to negotiate to resolve some of the state's concerns about the regulation of Native American businesses.
If the state tries to force the Onondaga Nation to collect taxes on the cigarettes the nation sells, Onondaga Chief Virgil Thomas said, the Onondagas will build a toll booth on Interstate 81 and charge a fee for those who cross their territory.
"If we can build this," he said, pointing to the nation's state-of-the-art lacrosse and hockey arena on Route 11, "we can build a toll booth."
The state Tax Department issued new proposed regulations concerning the collection of taxes on Indian nations Sept. 12. But leaders of the six Indian nations that make up the Iroquois Confederacy, or Haudenosaunee, maintain that the Iroquois treaties with New York bar the state from imposing taxes on Indian land.
In the past week, leaders of the Oneida Indian Nation, Cayuga Indian Nation, Seneca Nation of Indians, Tuscarora Nation, Tonawanda Band of Senecas, and St. Regis Mohawks have vowed to resist any effort by the state to collect taxes on sales on their lands.
"This is not going to get resolved," said John Kane, a Mohawk manager at Ross John Enterprises, which owns a Holiday Inn and four cigarette and gasoline shops on the Seneca Nation's territories in western New York. "The state is going to back down again."
Such vows raise images of 1997 - the last time the state attempted to force the collection of taxes in Indian nations. That attempt spurred demonstrations, roadblocks and other incidents at Indian territories across the state. The state abandoned the effort.
The new state regulations would require businesses on Indian territories to purchase cigarettes and motor fuel from wholesalers. The state would charge the wholesalers the $15-per-carton excise tax on cigarettes. The wholesalers would pass the state excise taxes on to the Indian businesses.
The Indian vendors would be expected to pass the cost on to non-Indian customers. Native American consumers would receive state-issued coupons so they could buy cigarettes from businesses on Indian lands and avoid paying the $15 per carton excise tax.
The state said it would also require non-Indians who buy cigarettes and other items from Indians on reservations to pay the state and local sales taxes, which range up to 7.25 percent. Consumers would not pay the sales tax at the register, but through a new line on their state income tax returns.
The state could prosecute anyone who fails to pay the sales tax on their income tax return.
Native American businesses are also expected under the proposal to pass on to non-native customers the 36.8 cents per gallon state taxes on gasoline, based on a $1.85 per gallon price.
The tax department estimated that the new regulations would help the state collect an extra $20 million in the state fiscal year that ends March 31 and $64.5 million in the following year.
New York lost about $500 million in 2001 and as much as $895 million in 2002 by failing to collect taxes on tobacco products sold by Native American businesses, over the Internet, and by bootleggers, according to a study paid for in 2002 by the FACT Alliance for the Fair Application of Cigarette Taxes.
Doug George-Kanentiio, a Mohawk writer who supports the traditional Iroquois chiefs, said traditional Iroquois are worried that the state will try to link the gas and cigarette taxes to negotiations over Indian casinos and land claims.
"The state will say at some point of the negotiations that they will withhold the expansion of casino gambling until the Indian nations comply with the tax regulations. That's what's going to happen," he said.
Meanwhile, non-Indian convenience store owners are unhappy that the state has allowed Indian businesses to have an unfair competitive advantage because of the tax issue.
Because of the price differences, there's been a huge shift of customers away from the tax-paying convenience stores to unlicensed, unregulated tax-free Native American stores selling cigarettes and gas, said James Calvin, president of the New York Association of Convenience Stores, which represents 1,800 stores.
Taxes vs. sovereignty
On this issue, economics butts up against sovereignty claims.
The U.S. Supreme Court in 1994 ruled that New York could collect taxes on cigarette and gas sold to non-Native Americans by businesses on Indian territories.
In 1996, Pataki announced plans to force businesses on Indian territories to collect and remit to the state taxes on gas and cigarettes sales to non-natives.
In 1997, traditional chiefs of the Onondaga, Tuscarora, Mohawk and Seneca nations negotiated with Pataki an alternative deal that would allow businesses on Indian territories to avoid collecting state taxes if the businesses were licensed by tribal governments, paid a fee to the tribal governments, and agreed to a minimum price system for the gas and cigarettes they sold.
The minimum prices and fee were designed to keep prices for cigarettes and gas at the Native stores on par with prices at other stores in New York. The Indian nations were to use the licensing fees to fund social programs on their territories.
But the deal was denounced by independent Native American business owners and their supporters, who claimed it violated Indian sovereignty.
While refusing to pay taxes to New York, independent native business owners were also opposed to paying licensing fees to their own tribal governments.
"We have free enterprise here in the Seneca Nation," Kane said.
In 1997, supporters of the Native American business owners briefly blocked traffic on Interstate 81 on the Onondaga territory, shut down a 40-mile stretch of highway on the Senecas' Allegany reservation, and closed the state Thruway for about 45 minutes on the Senecas' Cattaraugus reservation.
After Pataki abruptly abandoned the commerce agreement, suspicious fires damaged houses owned by traditional Onondaga Chief Ollie Gibson and Tuscarora Chief Leo Henry.
The new initiative
Despite ongoing complaints from off-reservation convenience store owners, the state opted not to push for a resolution of the sales tax issue with the Native American businesses until this year.
In May, Pataki announced a tentative land claim settlement with the St. Regis Tribal Council - the elected Mohawk government at Akewesasne in northern New York - that also would allow the Mohawks to open a casino in the Catskills and to be free of state taxes on Mohawk sales of cigarettes and gas to non-natives.
The newly elected Mohawk tribal council has since rejected that agreement with Pataki.
In passing its own state budget in May, the legislature mandated that the Pataki administration begin taxing the sales of cigarettes and gas to non-native customers by businesses located on Indian territories, claiming that the state could collect $165 million in revenue.
Pataki criticized the legislature, saying that such action would have "devastating consequences for the state's relationship with Native Americans" and insisted the issue should be resolved through government-to-government negotiations with the Indian nations.
Last week, Pataki's state tax department issued its new proposed tax regulations, which are scheduled to become effective Dec. 1 unless the tribal governments reach alternative agreements with the state.
"These regulations were mandated by the legislature over the governor's veto. The tax department must follow the law," said Tom Bergin, a spokesman for the tax department.
Heath, who represents the Onondaga Nation, the Tonawanda Band of Senecas and the Tuscarora Nation, met Wednesday in Albany with two members of Pataki's staff to learn about the proposed regulations and to open the door for negotiations on an alternative commerce agreement.
The 1997 deal that Pataki and the traditional chiefs negotiated could be used as a starting point for a new round of negotiations, Heath said.
Reviving the 1997 commerce agreement - which would mean the traditional chiefs would regulate businesses on Indian territories - is one way to avoid the state imposing taxes on Dec. 1, said George-Kanentiio.
Heath said no one knows if the tax department's initiative will prompt the kinds of demonstrations and violence that occurred in 1997.
"Will the fires start up again? Who knows," Heath said. "I don't want to predict there will be no protests."
The atmosphere is different than it was in 1997 at Onondaga because the people of the Onondaga Nation forced the privately owned cigarette and gas businesses to shut down and the nation now runs the only cigarette business on the territory.
The business climate is different at the Mohawk, Seneca, and Tuscarora nations.
There, businesses that are not licensed by the Native American governments and contribute no revenue to the governments sell tax-free gas and cigarettes.
Native Americans will block the highways if the state tries to tax the reservation businesses, predicted Kane, a Mohawk who in 1990 was convicted of conspiring to torch the Oneida Nation's bingo hall.
"You can't shut down people's livelihood and not expect a fairly tumultuous response," Kane said.
I wonder how the state would respond if whites rioted to avoid paying taxes that the SCOTUS ruled could be collected (he asks rhetorically)?
It would seem that a truer statement would be the amount that they "lost" to bootleggers, because they were never entitled to reservation/internet sales tax. Another case of saying you didn't get something, ergo you lost it. I guess I lost hundreds of millions last year because I never hit a jackpot at a casino and never hit the lottery...
Why do you say they were never entitled to it? The court ruled they were long before 2001.
The rest of the piece offers too many ironies this early in the morning (8:33 am).
The whole reservation is smaller than most suburban housing developments, and looks about like a pineywoods enclave in the Carolinas : cars up on blocks,etc. Hopefully, casino money has led to a few improvements,but to consider these folks a threat borders on the ludicrous.
Sorry folks ! This doesn't do much for Warrior Spirit,etc.,but "Indian Nations" is more feel-good concept than reality.
The State of New York stole all the Oneida land using the argument that the Oneida were actually "white" and had no right to their own property. The USSC has subsequently ruled the Oneida were entitled to their own land in New York. At the moment they are still busy picking out the best spots, and that's pretty hard considering what the other kind of "whites" have done with New York land. One particular horror involves the ballast under the former Conrail/Penn Central/NY Central roadbed along the Hudson. Seems it's made up of bones taken from the Mohican Ossuary (which had something like 10,000 years worth of bones.) Think about that next time you go that way.
BTW, the Onondaga and the Oneida are protected by the very first treaty between the United States and any Indian nation. The Mohawk and a couple of the other nations within the Iriquois Confederation are additionally protected by the Treaty of Paris that set the United States free from UK control.
If you would like to repudiate the Treaty of Paris, you might let Tony Blair and Queen Elizabeth know. They would probably be very pleased to see that a "fifth column" has been raised up from the broad masses of the American people.
The trick for folks who do not care for Indian nations in their state is to MOVE SOMEWHERE ELSE. There are plenty of places without Indian nations.
The Supreme Court ALSO ruled that Oneidas had to collect and remit sales tax on sales made to non-Indians. So if you're going to argue that we have to abide by the SCOTUS rulings then the tribes have to pay the tax.
But thanks for making my point: the tribal leaders, a corrupt group that rivals the Mafia for ruthlessness and audacity, have no problem hiding behind the SCOTUS and "white man's law" when it suits their purposes. But as soon as it doesn't, they claim sovereignty and ignore the law, or even riot.
And the State of New York, desperate to be "politically correct," doesn't do a thing about it.
The whole Indian nation concept has turned in to a scam for making money by exploiting loopholes in the white man's law. With the help of connected DemocRAT lawyers. Here's where the tribes tried to institute a kickback/payoff/bribe scheme for development in California. To make California one big sacred Indian site ------>
SACRAMENTO -- California Indians suffered a rare defeat in the closing hours of this year’s legislative session when lawmakers refused to approve a bill to protect tribal sacred sites.
Despite repeated votes and weeks of negotiation, the Assembly refused to approve the measure.
Senate Bill 18 by Senate leader John Burton, D-San Francisco, failed on a vote of 38-14, with 41 votes needed for passage.
The vote shocked tribal representatives and moved some to tears outside the chamber while leaving opponents muted in their victory. Advocates on both sides of the issue agreed this isn’t the end of the debate.
"This is something we are not going to give up on," said Brenda Soulliere, chairwoman of the California Nations Indian Gaming Association and a member of the Cabazon Band of Mission Indians, Indio. "We’ll come back stronger next year."
DeAnn Baker, a lobbyist for the California State Association of Counties, a member of a coalition that included most of the state’s major business interests opposed to the bill, agreed that the goal is worthwhile.
"I think we are willing to start over," Baker said.
The issue has pitted tribes, who argue that too often little attention is paid to their spiritually important sites in development projects, against business groups, which insist that the bill could block or delay a wide range of vital school, transportation and other projects.
SB 18 essentially would have required the state’s environmental review process to assess the potential impact of a development on a sacred site and to come up with ways to offset any damage.
There are an estimated 500 sacred sites in the state, according to proponents.
But the bill also would have given the existing Native American Heritage Commission an expanded role to develop criteria to identify sacred sites, list them and facilitate consultation among parties over possible developments.
thanks...for the education...1/128 Cherokee....missed by 6 generations :))
Wow. Hadn't heard about that one. Another completely idiotic decision by SCOTUS.
Just a guess, but I expect that any roadblock will be somewhere along the stretch between Syracuse and Cortland.
Anytime this question of Native American sovereignty comes up, I always ask this . . . Do these "independent" Native Americans use ANY state-supplied services? Medical? Welfare? Educational? Etc.
If so, do you think it's fair that American taxpayers are expected to subsidize an independent and sovereign nation's people?
Some say that's the price we have to pay for the way the Native Americans have been treated in history-past. Okay, fine, so you're in favor of slave reparations then, right?
I'm sorry, I just don't like the thought of carving up our country and saying ANY group has rights that aren't shared by all. Yes, Native Americans have been treated horribly, even criminally, in our past. But when does the statute of limitations expire? Will my great-great-great-grandchildren still be paying for 1800-ish wrongs in the year 2150?
So . . . should the Irish band together and ask that Boston be given to them? Or Hispanic-Americans . . . should they expect to receive 1/3 of Texas as their own little fiefdom? Or all of California? Okay, okay, LOL, I know some say they're welcome to California . . . but my point is this -- When ANY law pits one race against another for an indeterminate amount of time . . . it's wrong.
Also, one of the basic tenements of conservative is to provide a hand up not a hand out to those less fortunate than us. Are we not, in fact, doing nothing but creating generation after generation of Native American "victims" by allowing them to play by rules far different from those imposed on society in general?
How long must society at large pay for the sins of our fathers?
I agree wholeheartedly. It does the Indians no good at all to maintain the fantasy that somehow they're independent of the United States, or that they ever again will enjoy the kind of lives they led before being displaced. The trouble with those old treaties is that they were made between the U.S. government and tribal entities that essentially didn't exist then, and certainly don't exist now. They should be formally scrapped, and the Indians fully assimilated (not that they aren't already fully assimilated, but as we can see, they use their "dual nationality" status to get some perks apart from those they enjoy as Americans).
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