A New York Supreme Court Justice has issued a preliminary injunction barring the state from collecting tobacco taxes on the reservation.

The law was passed to force tribal retailers to collect taxes on the sale of tobacco to non-Indians. But Justice Rose Sconiers said it would also have an impact on tribal members who are supposed to be tax exempt.

New Gov. Eliot Spitzer (D) said he will implement the law to address the concerns raised in the ruling. The state has to issue special coupons to Indian customers and create a system to process refunds for taxes that shouldn't have been paid.

Tribes in the state have opposed the new law. Former Gov. George Pataki (R) declined to enforce it.

Get the Story:
Court rules cigarettes can stay tax-free (The Syracuse Post-Standard 1/9)
Victory for tribe tobacco sales (AP 1/9)

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