Deadline looms for tribes in New York over state tobacco taxes
Tuesday, August 31, 2010
Starting on Wednesday, the state of New York will impose a tobacco tax on reservations unless a federal judge takes action.
Wholesalers that sell tobacco to tribal retailers must prepay the state's tax. The plan essentially forces tribal retailers to collect the state's tax on tobacco sold to non-Indians.
Tobacco sold to tribal members will remain tax-free. The state gets to determine how much each tribal retailer gets, based on U.S. Census Bureau data on reservations.
Tribes say the plan violates their sovereignty, their regulatory systems and their treaties. But a federal judge so far has declined to block the state from imposing the tax.
The state's tobacco tax is the highest in the nation. Non-Indian smokers have been flocking to reservations to buy cigarettes before tomorrow's deadline.
The Seneca Nation, the Oneida Nation and the Onondaga Nation say they will drop big tobacco brands and sell Indian brands as a result of the plan. The St. Regis Mohawk Tribe also says it might stop selling big name tobacco.
EDITORIAL FOOTNOTE: Story taken from www.indianz.com