Istook told the U.S. House Committee on Resources that honest taxpayers are carrying an extra burden to pay for roads, schools and public safety. As he told them, law-abiding citizens must pay extra because of tax cheating. It costs Oklahoma and other states over a billion dollars a year because some tribal businesses refuse to collect taxes on sales to non-Indians, despite a Supreme Court ruling saying they should. Despite what some Indian tribes say, this is not a matter of sovereign immunity nor of treaty rights. The U.S. Supreme Court has ruled repeatedly that those are phony claims.
Nobody has a special privilege to ignore the tax laws.
But if tribal businesses don't charge gasoline or cigarette taxes, they make a fortune through lower prices, profiting from tax evasion. The first problem is that this drives legitimate, tax-paying competition out of business for miles around. The second problem is that it destroys the tax base that states and cities use to finance roads, schools, parks, housing, public safety and health. The Constitution says we're all equal under the law. Let's make that true again.