indianz.com your internet resource indianz.com on facebook indianz.com on twitter indianz.com on Google+
ph: 202 630 8439
Fredericks Peebles & Morgan LLP
Advertise on Indianz.Com
Home > News > Headlines

printer friendly version
Tobacco tax bill still poses challenges for Indian Country
Tuesday, December 16, 2003

A bill that gives states greater powers to collect taxes on the sale of cigarettes cleared the U.S. Senate last week with little debate.

Before winning unanimous consent from the chamber, the Protect All Cigarette Trafficking (PACT) Act was stripped of its most damaging provision. Language in the original bill would have abrogated tribal sovereign immunity by allowing states to bring tax enforcement actions against tobacco businesses on Indian land.

Sens. Ben Nighthorse Campbell (R-Colo.) and Daniel Inouye (D-Hawaii), the chairman and vice-chairman of the Senate Indian Affairs Committee, objected to the provision. They worked with the National Congress of American Indians (NCAI) and other organizations to remove what tribal leaders said was a reversal of 200 years of Supreme Court precedent.

But tribal leaders and their advocates aren't entirely satisfied with the final product. They warn S.1177 could still lead to state intrusion on tribal rights.

Furthermore, the version that will be considered in the House next year includes language that waives tribal immunity. H.R.2824 authorizes states to sue tribes and individual Indians in federal court if they don't collect the state tax.

"It's merely a ploy to put Indian Country out of business," Joe Brooks, chief of the Delaware Tribe of Oklahoma, said at the annual NCAI convention last month. "It's a direct stab on Indian Country."

PACT supporters include the Campaign for Tobacco Free Kids, which believes imposing taxes discourages youth from smoking. American Indian and Alaska Native teens have the highest rate of tobacco use among all ethnic and racial groups.

But the biggest backers are state governments that claim they will lose up to $1.5 billion in tax revenues by the year 2005 through the sale of tobacco via the Internet and mail order businesses. The National Association of Attorneys General worked with lawmakers on the latest version of S.1177.

The sponsors of PACT include Sens. Orrin Hatch (R-Utah) and Patrick Leahy (D-Vt.), the leaders of the Senate Judiciary Committee, and Sen. Herb Kohl (D-Wis.), a member of the committee. Last week, Kohl said the bill "will achieve the goals we set out to attain -- to put an end to both cigarette trafficking and tobacco tax avoidance -- while leaving the important principles of Indian tribal sovereignty unaffected. "

"These moderate, but important, changes will further enable federal, state, local, and tribal officials to crack down on tobacco smugglers and ensure that Internet tobacco sellers pay applicable taxes," he said on Tuesday, when S.1177 was approved.

Tribal advocates are concerned the bill could be interpreted to apply not only to Internet businesses, which some tribes and tribal members operate, but to smokeshops on Indian land. They also believe a provision that allows states and local governments to create lists of "compliant" and "non-compliant" businesses intrudes on tribal sovereignty.

Additionally, tribes point out that they have already entered into compacts with some states regarding tobacco taxation. Tribes, like states, depend on tobacco revenues to keep their government running.

In pushing for the passage of PACT, Leahy said it would "crack down on the growing problem of cigarette smuggling, both interstate and international, as well as to address the connection between cigarette smuggling activities and terrorist funding." "Criminals are getting away with smuggling and not paying tobacco taxes because of weak punishments, products that are often poorly labeled, the lack of tax stamps and the inability of the current distribution system to track sales from state to state," he said on the Senate floor.

H.R.2824, the Internet Tobacco Sales Enforcement Act, will be considered by the House Judiciary Committee once the House reconvenes in January 2004. It was approved October 2 but a subcommittee of that panel. The definition of "person" is expanded to include tribal governments and Indian retailers.

Get the Bills:
PACT Act (S.1177) | Internet Tobacco Sales Enforcement Act (H.R.2824)

Relevant Links:
National Congress of American Indians - http://www.ncai.org
Campaign for Tobacco Free Kids - http://www.tobaccofreekids.org

Related Stories:
Tribes left out of Internet and cigarette tax bills (11/19)

Copyright 2000-2003 Indianz.Com
More headlines...
Stay Connected:

Local Links:
Federal Register | Indian Gaming | Jobs & Notices | In The Hoop | Message Board
Latest News:
Native Sun News: Montana basketball legend gives back to youth (1/23)
Mark Trahant: Building the new digital economy in Indian Country (1/23)
James Giago Davies: Washington team insults the first Americans (1/23)
Gyasi Ross: Indian Country can't get enough of Seattle Seahawks (1/23)
Jay Daniels: A tribute to Crow basketball legend Elvis D. Old Bull (1/23)
Richard Thornton: People of One Fire exposing forgotten history (1/23)
NARF: Supreme Court decision impacts rights of Indian inmates (1/23)
Oglala Sioux medicine man dies awaiting trial in sex abuse case (1/23)
No charges filed for deaths of two people on Barona Reservation (1/23)
IRS placed $664K in tax liens on leader of Lower Brule Sioux Tribe (1/23)
Yellowstone National Park starts transferring bison for slaughter (1/23)
Fire in 1865 destroyed Smithsonian collection of Indian portraits (1/23)
Turtle Talk: Gaming compact cases are extremely difficult to win (1/23)
Governor rejects Menominee Nation off-reservation gaming plan (1/23)
Otoe-Missouria Tribe reaches agreement with city for new casino (1/23)
Chehalis Tribe to start work on $40M expansion of gaming facility (1/23)
Idaho lawmakers question gaming machines at non-Indian tracks (1/23)
State of Indian Nations as delivered by NCAI President Cladoosby (1/22)
Sen. Barrasso delivers response to NCAI's State of Indian Nations (1/22)
Native Sun News: Tribes step up with donations for cultural center (1/22)
Ivan Star: Indian Country must put more effort in public relations (1/22)
Steven Newcomb: Indian policy is unmistakenly linked to religion (1/22)
Harlan McKosato: Apache woman develops 'indispensible' guide (1/22)
Tristan Ahtone: Former Native gang member tries to start anew (1/22)
Q&A with Chemehuevi artist Cara Romero on 'Last Indian Market' (1/22)
Sainthood for founder of brutal California Indian mission system (1/22)
Native mayor promises to change city's reputation as most racist (1/22)
Deadline passes to appeal Fond du Lac Band land-into-trust case (1/22)
City rejects Citizen Potawatomi Nation land detachment petition (1/22)
Oklahoma lawmakers debate future of unfinished Indian museum (1/22)
Yocha Dehe Wintun Nation inaugurates Leland Kinter as chairman (1/22)
City to enter public transportation contract with Mississippi Band (1/22)
Officials in Idaho won't try to find a new name for 'Squaw Butte' (1/22)
Opinion: Blood Run landmark a place of reverence for area tribes (1/22)
Chukchansi Tribe set to run out of money for gaming per capitas (1/22)
Forest County Potawatomi Tribe sues BIA over rejected compact (1/22)
Menominee Nation expects fast action from BIA on new compact (1/22)
Some CSKT leaders question $27.4M expansion of gaming facility (1/22)
Narragansett Tribe wins litigation filed by former gaming partner (1/22)
Column: Tribes concerned about commercial casinos in New York (1/22)
Native Sun News: Oglala Sioux Tribe contests uranium expansion (1/21)
Clara Caufield: Run recalls days of horror for Northern Cheyenne (1/21)
Brandon Ecoffey: Officer shooting reveals anti-Indian sentiment (1/21)
Ron Allen: Jamestown S'Klallam Tribe supports bond for schools (1/21)
Erik Stegman: Setting the record straight on gaming per capitas (1/21)
Jacqueline Keeler: Keystone fight is about more than a pipeline (1/21)
more headlines...

Home | Arts & Entertainment | Business | Canada | Cobell Lawsuit | Education | Environment | Federal Recognition | Federal Register | Forum | Health | Humor | Indian Gaming | Indian Trust | Jack Abramoff Scandal | Jobs & Notices | Law | National | News | Opinion | Politics | Sports | Technology | World

Indianz.Com Terms of Service | Indianz.Com Privacy Policy
About Indianz.Com | Advertise on Indianz.Com

Indianz.Com is a product of Noble Savage Media, LLC and Ho-Chunk, Inc.