Indianz.Com > News > Gavin Clarkson: It’s past time to end double taxation in Indian Country
Deb Haaland
Secretary of the Interior Deb Haaland, second from right, speaks a meeting of tribal water issues in the Colorado River Basin in Albuquerque, New Mexico, on March 28, 2022. Photo: U.S. Department of the Interior
It’s past time to end double taxation in Indian Country
Thursday, April 7, 2022

The following is the text of an open letter to Secretary of the Interior Deb Haaland and Assistant Secretary for Indian Affairs Bryan Newland.

Dear Secretary Haaland and Assistant Secretary Newland,

I am writing to you both publicly because attempts to contact you individually have not been successful. I realize that, as a former Donald Trump administration official, taking my calls or responding to my inquiries presents a challenge in the present political climate. I hope, however, that we can all agree that Indian Affairs does not need to be overly partisan, and it is in that spirit that I am writing to you today.

In late 2016, the outgoing Barack Obama administration proposed updating the Indian Trader regulations to eliminate the problem of double taxation created by the U.S. Supreme Court in Cotton Petroleum. This was an issue that I had studied for years, and I published an article at the 2017 Sovereignty Symposium, American Indians versus the Billion-Dollar Tax Weevil, calling for the elimination of double taxation on job creators in Indian Country.

The chance to advance that policy objective was the primary reason I accepted President Trump’s appointment as Deputy Assistant Secretary for Policy and Economic Development, and during my time at Interior, we developed a strong economic argument that not only Indian Country, but the entire nation, would be better off if double taxation was eliminated for on-reservation job creators.

The Problem of Double-Taxation in Indian Country
The Problem of Double-Taxation in Indian Country by Gavin Clarkson appears in the March/April 2022 issue of The Federal Lawyer, a publication of the Federal Bar Association.

Unfortunately, swamp creatures exist on both sides of the political aisle, and the Tax Weevils at the state level are exceedingly myopic, so despite my strong objections, that entire project was mothballed in late 2017. Rather than give up on this vitally important initiative, I resigned from the Department of the Interior and ran for Congress in New Mexico with the elimination of double taxation on job creators in Indian Country as my primary economic proposal. Our analysis indicated that my proposal would generate at least $2 Billion for New Mexico and $40 Billion nationwide, all without costing federal taxpayers a single dime.

Secretary Haaland also ran for Congress that same year, and when then-candidate Haaland and I appeared together at a forum hosted by the All Pueblo Council of Governors during the 2018 primary, I approached her to discuss my proposal to end double taxation. She seemed surprisingly uninterested in the proposal, but perhaps she didn’t want to be seen making nice with a Republican. If so, that was unfortunate, but also in the past.

When Larry Roberts was announced as Interior Chief of Staff in 2021, I was hopeful that the Indian Trader regulation revision effort would be reignited, since Larry was the acting Assistant Secretary when that initiative was first put forward. However, to those of us on the outside, it appears that nothing has happened. Even more troubling, apparently some folks at Interior are afraid to reach out to me directly regarding that project despite having both my personal cell phone and email. Instead, they reached out to friends of mine to ask where the information is.

Gavin Clarkson
Gavin Clarkson is seen in Washington, D.C., in February 2018. Photo by Indianz.Com (CC BY-NC-SA 4.0)

Rather than play the schoolyard telephone game, I published an article in this month’s Federal Lawyer that serves up everything on a silver (and turquoise) platter. All the data at Interior is referenced with URLs, as is the working paper that I developed along with our chief economist, Dr. Steve Payson. Dr. Payson separately published a generalized version of our model, which my article also references.

My Federal Lawyer article thus contains everything Interior needs to justify revising the Indian Trader regulations and eliminate double taxation on job creators in Indian Country. Both the data and the model are now publicly available, and the model has been published in a peer-reviewed economics journal, so everyone can now repeat our analysis and reproduce our results.

Since this initiative was started under Obama, and advanced to the goal line under Trump, its bipartisan bona fides are evident. The National Congress of American Indians, the United South and Eastern Tribes, NAFOA, and National Intertribal Tax Alliance all support my proposal, as do most tribal leaders that have weighed in on the issue. Even Grover Norquist at Americans for Tax Reform has endorsed my proposal. All that is required is for someone in the Biden administration to push it across the goal line.

Yes, I am a Republican, and yes, I think the vast majority of the Joe Biden presidency has been an unmitigated disaster. But I would gladly let this administration take credit for finally fixing the problem of double taxation. Indian Country’s economic health is vastly more important than scoring partisan points.

Please don’t let the fact that someone in the Trump administration did all of the heavy lifting on this initiative dissuade the Biden administration from actually accomplishing something on double taxation.

I will be at the Federal Bar Association’s Indian Law Conference this week, and I am happy to discuss this issue with the folks from Interior that will be in attendance.


Dr. Gavin Clarkson, Esq., served as the Deputy Assistant Secretary for Policy and Economic Development – Indian Affairs at the Department of the Interior in 2017.