Source: https://m.openjurist.org/447/us/134
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Matched Legal Cases: ['§ 461', '§ 1451', '§ 450', '§ 261', '§ 1153', '§ 479', '§ 461', '§ 461', '§ 20', '§ 105', '§ 465', '§ 5', '§ 1360', '§ 13', '§ 479', '§ 461', '§ 2281', '§ 2281', '§ 2101', '§ 84', '§ 469', '§ 564']

447 US 134 Washington v. Confederated Tribes of Colville Indian Reservation Washington | OpenJurist
447 U.S. 134 - Washington v. Confederated Tribes of Colville Indian Reservation Washington
State of WASHINGTON et al., Appellants,
CONFEDERATED TRIBES OF the COLVILLE INDIAN RESERVATION et al. State of WASHINGTON v. UNITED STATES et al.
The Tribes contend that their involvement in the operation and taxation of cigarette marketing on the reservation ousts the State from any power to exact its sales and cigarette taxes from nonmembers purchasing cigarettes at tribal smokeshops. The primary argument is economic. It is asserted that smokeshop cigarette sales generate substantial revenues for the Tribes which they expend for essential governmental services, including programs to combat severe poverty and underdevelopment at the reservations. Most cigarette purchasers are outsiders attracted onto the reservations by the bargain prices the smokeshops charge by virtue of their claimed exemption from state taxation. If the State is permitted to impose its taxes, the Tribes will no longer enjoy any competitive advantage vis-a-vis businesses in surrounding areas. Indeed, because the Tribes themselves impose a tax on the transaction, if the state tax is also collected the price charged will necessarily be higher and the Tribes will be placed at a competitive disadvantage as compared to businesses elsewhere. Tribal smokeshops will lose a large percentage of their cigarette sales and the Tribes will forfeit substantial revenues. Because of this economic impact, it is argued, the state taxes are (1) pre-empted by federal statutes regulating Indian affairs; (2) inconsistent with the principle of tribal self-government; and (3) invalid under "negative implications" of the Indian Commerce Clause.
It is painfully apparent that the value marketed by the smokeshops to persons coming from outside is not generated on the reservations by activities in which the Tribes have a significant interest. Cf. Moe v. Salish & Kootenai Tribes, 425 U.S., at 475-481, 96 S.Ct., at 1642-1645; McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 93 S.Ct. 1257, 36 L.Ed.2d 129 (1973). What the smokeshops offer these customers, and what is not available elsewhere, is solely an exemption from state taxation. The Tribes assert the power to create such exemptions by imposing their own taxes or otherwise earning revenues by participating in the reservation enterprises. If this assertion were accepted, the Tribes could impose a nominal tax and open chains of discount stores at reservation borders, selling goods of all descriptions at deep discounts and drawing custom from surrounding areas. We do not believe that principles of federal Indian law, whether stated in terms of pre-emption, tribal self-government, or otherwise, authorize Indian tribes thus to market an exemption from state taxation to persons who would normally do their business elsewhere.
The federal statutes cited to us, even when given the broadest reading to which they are fairly susceptible, cannot be said to pre-empt Washington's sales and cigarette taxes. The Indian Reorganization Act of 1934, 48 Stat. 984, 25 U.S.C. § 461 et seq., the Indian Financing Act of 1974, 88 Stat. 77, 25 U.S.C. § 1451 et seq., and the Indian Self-Determination and Education Assistance Act of 1975, 88 Stat. 2203, 25 U.S.C. § 450 et seq., evidence to varying degrees a congressional concern with fostering tribal self-government and economic development, but none goes so far as to grant tribal enterprises selling goods to nonmembers an artificial competitive advantage over all other businesses in a State. The Indian traders statutes, 25 U.S.C. § 261 et seq., incorporate a congressional desire comprehensively to regulate businesses selling goods to reservation Indians for cash or exchange, see Warren Trading Post Co. v. Arizona Tax Comm'n, 380 U.S. 685, 85 S.Ct. 1242, 14 L.Ed.2d 165 (1965), but no similar intent is evident with respect to sales by Indians to nonmembers of the Tribe. The Washington Enabling Act, 25 Stat. 676, reflects an intent that the State not tax reservation lands or income derived therefrom, but the present taxes are assessed against nonmembers of the Tribes and concern transactions in personalty with no substantial connection to reservation lands. The relevant treaties, Treaty of Point Elliott, 12 Stat. 927 (1855) (Lummi Tribe); Treaty with the Makah Tribe, 12 Stat. 939 (1855); Treaty with the Yakimas, 12 Stat. 951 (1855), can be read to recognize inherent tribal power to exclude non-Indians or impose conditions on those permitted to enter; but purchasers entering the reservation are not the State's agents and any agreements which they might make cannot bind it. Finally, although the Tribes themselves could perhaps pre-empt state taxation through the exercise of properly delegated federal power to do so, cf. Fisher v. District Court, 424 U.S. 382, 390, 96 S.Ct. 943, 948, 47 L.Ed.2d 106 (1976) (per curiam); United States v. Mazurie, 419 U.S. 544, 95 S.Ct. 710, 42 L.Ed.2d 706 (1975), we do not infer from the mere fact of federal approval of the Indian taxing ordinances, or from the fact that the Tribes exercise congressionally sanctioned powers of self-government, that Congress has delegated the far-reaching authority to pre-empt valid state sales and cigarette taxes otherwise collectible from nonmembers of the Tribe.
Washington does not infringe the right of reservation Indians to "make their own laws and be ruled by them," Williams v. Lee, 358 U.S. 217, 220, 79 S.Ct. 269, 271, 3 L.Ed.2d 251 (1959), merely because the result of imposing its taxes will be to deprive the Tribes of revenues which they currently are receiving. The principle of tribal self-government, grounded in notions of inherent sovereignty and in congressional policies, seeks an accommodation between the interests of the Tribes and the Federal Government, on the one hand, and those of the State, on the other. McClanahan v. Arizona State Tax Comm'n, supra, at 179, 93 S.Ct., at 1266. While the Tribes do have an interest in raising revenues for essential governmental programs, that interest is strongest when the revenues are derived from value generated on the reservation by activities involving the Tribes and when the taxpayer is the recipient of tribal services. The State also has a legitimate governmental interest in raising revenues, and that interest is likewise strongest when the tax is directed at off-reservation value and when the taxpayer is the recipient of state services. As we have already noted, Washington's taxes are reasonably designed to prevent the Tribes from marketing their tax exemption to nonmembers who do not receive significant tribal services and who would otherwise purchase their cigarettes outside the reservations.
It can no longer be seriously argued that the Indian Commerce Clause, of its own force, automatically bars all state taxation of matters significantly touching the political and economic interests of the Tribes. See Moe v. Salish & Kootenai Tribes, supra, 425 U.S., at 481, n. 17, 96 S.Ct., at 1645. That Clause may have a more limited role to play in preventing undue discrimination against, or burdens on, Indian commerce. But Washington's taxes are applied in a nondiscriminatory manner to all transactions within the State. And although the result of these taxes will be to lessen or eliminate tribal commerce with nonmembers, that market existed in the first place only because of a claimed exemption from these very taxes. The taxes under consideration do not burden commerce that would exist on the reservations without respect to the tax exemption.
The District Court struck down all recordkeeping requirements with respect to cigarette sales, because it found that no cigarette sales were taxable. With respect to sales of items other than cigarettes, the District Court found no record evidence "as to whether the record keeping requirements, as promulgated, are or are not reasonably necessary to ensure payment of lawful taxes." 446 F.Supp., at 1373. The District Court upheld the requirements insofar as they pertained to taxable sales, but struck them down with respect to nontaxable sales on the ground that the State had not met its burden of showing that the regulation was reasonably necessary to ensure payment of taxes which it had power to impose.
The State asserts the power to apply its sales and cigarette taxes to Indians resident on the reservation but not enrolled in the governing Tribe. The issue arose in the Yakima case in the wake of the District Court's determination that the state retail sales tax could be applied to the purchase by non-Indians of goods other than cigarettes. It was, of course, quite clear after Moe and McClanahan that the sales tax could not be applied to similar purchases by tribal members, but the State argued that this exemption should not extend to nonmembers of the Tribe. Relying in part on the lower court opinion in Moe, Confederated Salish & Kootenai Tribes v. Moe, 392 F.Supp. 1297, 1312 (Mont.1975) (three-judge court), the District Court rejected the contention. 446 F.Supp., at 1371-1372. This Court did not reach the question in Moe because Montana failed to raise it on appeal. We do reach it now, and we reverse.
Federal statutes, even given the broadest reading to which they are reasonably susceptible, cannot be said to pre-empt Washington's power to impose its taxes on Indians not members of the Tribe. We do not so read the Major Crimes Act, 18 U.S.C. § 1153, which at most provides for federal-court jurisdiction over crimes committed by Indians on another Tribe's reservation. Cf. United States v. Antelope, 430 U.S. 641, 646-647, n. 7, 97 S.Ct. 1395, 1398-1399, 51 L.Ed.2d 701 (1977). Similarly, the mere fact that nonmembers resident on the reservation come within the definition of "Indian" for purposes of the Indian Reorganization Act of 1934, 48 Stat. 988, 25 U.S.C. § 479, does not demonstrate a congressional intent to exempt such Indians from state taxation.
We find that Washington's interest in enforcing its valid taxes is sufficient to justify these seizures. Although the cigarettes in transit are as yet exempt from state taxation, they are not immune from seizure when the Tribes, as here, have refused to fulfill collection and remittance obligations which the State has validly imposed. It is significant that these seizures take place outside the reservation, in locations where state power over Indian affairs is considerably more expansive than it is within reservation boundaries. Cf. Mescalero Apache Tribe v. Jones, 411 U.S. 145, 93 S.Ct. 1267, 36 L.Ed.2d 114 (1973). By seizing cigarettes en route to the reservation, the State polices against wholesale evasion of its own valid taxes without unnecessarily intruding on core tribal interests.
The next issue concerns the challenge in the Colville case to the Washington motor vehicle and mobile home, camper and travel trailer taxes. Although not identical, these taxes are quite similar. Each is denominated an excise tax for the "privilege" of using the covered vehicle in the State, each is assessed annually at a certain percentage of fair market value, and each is sought to be imposed upon vehicles owned by the Tribe or its members and used both on and off the reservation.29
Once again, our departure point is Moe. There we held that Montana's personal property tax could not validly be applied to motor vehicles owned by tribal members who resided on the reservation. 425 U.S., at 480-481, 96 S.Ct., at 1644-1645. The vehicles Montana attempted to tax were apparently used both on and off the reservation,30 and the tax was assessed annually at a percentage of market value of the vehicles in question. Thus, the only difference between the taxes now before us and the one struck down in Moe is that these are called excise taxes and imposed for the privilege of using the vehicle in the State, while the Montana tax was labeled a personal property tax. The State asserts that this difference mandates a different result. In Moe, it argues, the District Court concluded that the taxable event was "the ownership of a motor vehicle as of January 1 of each year,"31 and that event took place on the reservation. Accordingly, under McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 93 S.Ct. 1257, 36 L.Ed.2d 129 (1973), Montana was without authority to impose its tax. In the present case, the State continues, the taxable event is the use within the State of the vehicle in question. Thus, we are told, the McClanahan principle is inapplicable and the tax should be upheld under Mescalero Apache Tribe v. Jones, supra.
We do not think Moe and McClanahan can be this easily circumvented. While Washington may well be free to levy a tax on the use outside the reservation of Indian-owned vehicles, it may not under that rubric accomplish what Moe held was prohibited. Had Washington tailored its tax to the amount of actual off-reservation use, or otherwise varied something more than mere nomenclature, this might be a different case. But it has not done so, and we decline to treat the case as if it had.
Finally, we come to the challenge by the Colville, Lummi, and Makah Tribes to the State's assumption of civil and criminal jurisdiction over them. The District Court found that assumption unlawful as regards the Makah and Lummi Reservations and lawful as regards the Colville Reservation. 446 F.Supp., at 1366-1367. The State challenges the former findings.
All parties apparently recognize that this issue is controlled by the intervening decision in the State's favor in Washington v. Yakima Indian Nation, 439 U.S. 463, 99 S.Ct. 740, 58 L.Ed.2d 740 (1979). There a pattern of jurisdiction identical to those created on the Makah and Lummi Reservations was upheld, and the holding of the Court of Appeals for the Ninth Circuit on which the District Court in the present case relied for its conclusion that such patterns are unconstitutional was reversed. We therefore uphold the State's assumption of jurisdiction over the Makah and Lummi Reservations.32 Accordingly, the judgment of the District Court is
I agree with the Court's analysis of the jurisdictional questions posed in these cases, as well as with its treatment of the Washington motor vehicle, mobile home, camper and travel trailer taxes and its disposition of the assumption-of-jurisdiction issue. Accordingly, I join in their entirety Parts I, II, III, V, and VI of the Court's opinion. I also agree with Part IV insofar as it holds that the Colville, Makah, and Lummi Tribes have the power to impose their cigarette taxes on nontribal purchasers (Part IV-B(1)). As the Court points out, the power to tax on-reservation transactions that involve a tribe or its members is a "fundamental attribute of sovereignty which the tribes retain unless divested of it by federal law or necessary implication . . .." Ante, at 152. Recognition of that fundamental attribute, however, leads me to disagree with much of the balance of the Court's Part IV. In my view, the State of Washington's cigarette taxing scheme should be invalidated both because it undermines the Tribes' sovereign authority to regulate and tax the distribution of cigarettes on trust lands and because it conflicts with tribal activities and functions that have been expressly approved by the Federal Government.
* I begin with a somewhat general overview. While they are sovereign for some purposes, it is now clear that Indian reservations do not partake of the full territorial sovereignty of States or foreign countries.1 The result has been to blur the boundary between state and tribal authority. A few guideposts do exist, however. First, in the absence of tribal consent state law does not reach on-reservation conduct involving only Indians. Thus we have held that tribal courts have exclusive jurisdiction over adoption proceedings involving the on-reservation conduct of tribal members, Fisher v. District Court, 424 U.S. 382, 96 S.Ct. 943, 47 L.Ed.2d 106 (1976); that States cannot apply their income taxes to the receipts derived by reservation Indians from reservation sources, McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 93 S.Ct. 1257, 36 L.Ed.2d 129 (1973); and that States may not levy cigarette taxes on on-reservation sales to reservation Indians or impose personal property taxes on property owned by such Indians, Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 480-481, 96 S.Ct. 1634, 1644-1645, 48 L.Ed.2d 96 (1976).
Second, there is a significant territorial component to tribal power. Thus state taxes on the off-reservation activities of Indians are permissible, Mescalero Apache Tribe v. Jones, 411 U.S. 145, 93 S.Ct. 1267, 36 L.Ed.2d 114 (1973), and tribal laws will often govern the on-reservation conduct of non-Indians. Williams v. Lee, 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251 (1959). See also United States v. Mazurie, 419 U.S. 544, 557-558, 95 S.Ct. 710, 717-718, 42 L.Ed.2d 706 (1975).2
Third, where it is necessary to resolve a conflict between state and tribal authority over on-reservation conduct involving Indians and non-Indians, a relatively particularistic look at the interests of State and tribe and the federal policies that govern relations with Indian tribes is appropriate. We have concluded, for example, that a tribe lacks jurisdiction to try a non-Indian for a crime, Oliphant v. Suquamish Indian Tribe, 435 U.S. 191, 208, 98 S.Ct. 1011, 1020, 55 L.Ed.2d 209 (1978), but that a State may not resolve a dispute arising out of on-reservation transactions between an Indian purchaser and a non-Indian seller, Williams v. Lee, supra, at 219, 79 S.Ct., at 270, or tax the gross receipts of a federally licensed retail trading post that deals on the reservation with reservation Indians, Warren Trading Post Co. v. Arizona State Tax Comm'n, 380 U.S. 685, 85 S.Ct. 1242, 14 L.Ed.2d 165 (1965).
And fourth, the preceding results flow from an intricate web of sources including federal treaties and statutes, the broad policies that underlie those federal enactments, and a presumption of sovereignty or autonomy that has roots deep in aboriginal independence. The prevalent mode of analysis is one of pre-emption. It takes as its starting point the exclusive power of the Federal Government to regulate Indian tribes and proceeds to bound state power where necessary to give vitality to the federal concerns at stake. Bryan v. Itasca County, 426 U.S. 373, 376, n.2, 96 S.Ct. 2102, 2105, 48 L.Ed.2d 710 (1976). Only rarely does the talismanic invocation of constitutional language or rigid conceptions of state and tribal sovereignty shed light on difficult problems. Moe, supra, 425 U.S., at 481, n.17, 96 S.Ct., at 1645, n.17; McClanahan v. Arizona State Tax Comm'n, supra, 411 U.S., at 172, 93 S.Ct., at 1262.
For present purposes, two federal concerns seem especially important. One is the strong and oft-cited policy of encouraging tribal self-government. United States v. Wheeler, 435 U.S. 313, 322-326, 98 S.Ct. 1079, 1085-1087, 55 L.Ed.2d 303 (1978); Fisher v. District Court, supra, at 386-388; McClanahan v. Arizona State Tax Comm'n, supra, 411 U.S., at 179, 93 S.Ct., at 1266; Williams v. Lee, supra, 358 U.S., at 219-220, 79 S.Ct., at 270. And the other is a complementary interest in stimulating Indian economic and commercial development. Both found expression in the Indian Reorganization Act of 1934, 25 U.S.C. § 461 et seq.,3 and are manifest in more recent statutes as well.4 They are, I believe, of central importance in analyzing any conflict of state and tribal law.
With this as background, I turn to the particular problem at hand. Like the Court, I begin with Moe, supra, which considered a state cigarette tax similar to the one at issue here. There we started with the observation that the tax itself was "concededly lawful"—it neither fell upon tribal members nor impinged on tribal functions. 425 U.S., at 483, 96 S.Ct., at 1646. The key problem, as we saw it, was one of enforcement: Could the State of Montana require the Indian seller to collect a tax validly imposed on the non-Indian purchaser? We determined that the burden of collection was minimal and noted that it would in no sense "frustrat[e] tribal self-government."5 Accordingly, we held that it could be imposed to prevent wholesale tax avoidance by non-Indian purchasers.
But while in Moe the cigarette business was largely a private operation, the Tribes involved in these cases have adopted comprehensive ordinances regulating and taxing the distribution of cigarettes by on-reservation shops. Phrased differently, these Tribes are acting in federally sanctioned and encouraged ways—they are raising governmental revenues, establishing commercial enterprises, and struggling to escape from " 'a century of oppression and paternalism.' " Mescalero Apache Tribe v. Jones, 411 U.S., at 152, 93 S.Ct., at 1272, quoting H.R.Rep. No. 1804, 73d Cong., 2d Sess., 6 (1934). As I see it, that difference has three important consequences. First, it means that in this case the sharp drop in cigarette sales that would result from imposition of the state tax will reduce revenues not only of individual Indian retailers, but also of the Tribes themselves as governmental units. Second, it means that a decision permitting application of the state tax would place Indian goods at an actual competitive disadvantage as compared to non-Indian ones because the former would have to bear two tax burdens while the latter bore but one. And third, it leads to an actual conflict of jurisdiction and sovereignty because imposition of the Washington tax would inject state law into an on-reservation transaction which the Indians have chosen to subject to their own laws.
The Court in effect concludes that these consequences are insignificant. The first, it suggests, is undercut by Moe, which made clear that Indian retailers have no absolute right to market their tax-exempt status. The second is too speculative—"the Tribes have failed to demonstrate that business at the smokeshops would be significantly reduced by a state tax without a credit as compared to a state tax with a credit." Ante, at 157. And the third "need not detain us" because "[t]here is no direct conflict between the state and tribal schemes. . . ." Ante, at 158.
I do not agree. Whatever their individual force, I think that in combination these three consequences bring the Washington taxes into sharp conflict with important federal policies. Perhaps most striking is the fact that a rule permitting imposition of the state taxes would have the curious effect of making the federal concerns with tribal self-government and commercial development inconsistent with one another. In essence, tribes are put to an unsatisfactory choice. They are free to tax sales to non-Indians, but doing so will place a burden upon such sales which may well make it profitable for non-Indian buyers who are located on the reservation to journey to surrounding communities to purchase cigarettes.6 Or they can decide to remain competitive by not taxing such sales, and in the process forgo revenues urgently needed to fill governmental coffers. Commercial growth, in short, can be had only at the expense of tax dollars. And having to make that choice seriously intrudes on the Indians' right "to make their own laws and be ruled by them," Williams v. Lee, 358 U.S., at 219-220, 79 S.Ct., at 271.7
The Court provides no satisfactory explanation of why the State is free to put the Tribes to such a choice. Rather, it characterizes the tribal business as an effort to market a tax exemption and proceeds to label that effort illegitimate and beyond the reasonable bounds of any federally protected tribal right. Yet that line of argument could at most justify a state tax which through some sort of credit mechanism ensures that the location of cigarette purchases is independent of state and tribal taxing schemes—it does not support a rule that the State may tax all on-reservation sales to non-Indians regardless of tribal taxes.8 Nor is the Court's argument saved by the contention that the Tribes have failed to prove that the combination of these particular tribal and state taxes will cause Indian smokeshops to lose volume that would otherwise be theirs. The fact is that the Court today permits the State to enact a tax without risking any attendant loss of business for its retailers while the Tribes must court economic harms when they enact taxes of their own. That result erodes the Tribes' sovereign authority and stands the special federal solicitude for Indian commerce and governmental autonomy on its head.
The conflict with federal law is particularly evident on the present facts because the Secretary of the Interior—acting pursuant to lawful regulations—has approved the tribal taxing and regulatory schemes at issue here. That approval, and the federal policies which underlie it, both enhances tribal authority and ousts inconsistent state law. Cf. Fisher v. District Court, 424 U.S. 382, 96 S.Ct. 943, 47 L.Ed.2d 106 (1976); United States v. Mazurie, 419 U.S. 544, 95 S.Ct. 710, 42 L.Ed.2d 706 (1975).
Because I would hold the state cigarette taxes invalid, I would not reach the bulk of the recordkeeping and enforcement issues addressed by the Court in Parts IV-C and IV-E of its opinion. Indeed, since the District Court failed to discuss most of those issues, I am startled that the majority proceeds to address and decide them rather than remanding for the views of that court. In my judgment, only one relatively narrow recordkeeping issue ought be addressed at this time, and that concerns the District Court's holding that the State could not require the Tribes to keep records of exempt sales to facilitate collection of valid taxes on nonexempt sales. 446 F.Supp. 1339, 1358-1359, 1373. The District Court found the record in this case inadequate to show any need for such documentation. The Court, however, sees this as no obstacle to upholding the requirement. I disagree. The State has no direct power over exempt sales, and I see no reason why it should be permitted to require Indians to keep records of such sales absent some showing of necessity or utility. In consequence, I would either affirm the District Court in this regard or remand so that the record may be supplemented.
I join all but Part IV-B(2) and Part V of the Court's opinion. My disagreement with Part V is for the reasons stated in Part III of Mr. Justice REHNQUIST'S separate opinion. My disagreement with Part IV-B(2) stems from the belief that the State of Washington cannot impose the full combined measure of its cigarette and sales taxes on purchases by nontribal members of cigarettes from tobacco outlets on the Colville, Lummi, and Makah Reservations.
In Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 481-483, 96 S.Ct. 1634, 1645-1646, 48 L.Ed.2d 96 the Court held that a State has the power to tax sales of cigarettes to non-Indians by Indian tobacco outlets, despite the exemptions from state taxes possessed by an Indian tribe and its members themselves. The State may exert this power, according to Moe, even if it thereby deprives the tribe or the enterprises the tribe operates of substantial revenues. Cf., Thomas v. Gay, 169 U.S. 264, 18 S.Ct. 340, 42 L.Ed. 740. The cigarette and sales tax aspects of this case would, therefore, be wholly controlled by the Moe decision, but for the fact that all of the appellee Tribes levy their own cigarette excise taxes on the on-reservation distribution of cigarettes to non-Indians.
It seems clear to me that the appellee Tribes enjoy a power at least equal to that of the State to tax the on-reservation sales of cigarettes to nontribal members. Those sales are entered into and consummated in places and circumstances subject to the Tribes' protection and control. Furthermore, the taxation of such transactions effectuates recognized federal policies by providing funds for the maintenance and operation of tribal self-government. See generally Indian Reorganization Act of 1934, 25 U.S.C. § 461 et seq.; McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 179-181, 93 S.Ct. 1257, 1266-1267, 36 L.Ed.2d 1295; Williams v. Lee, 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251.
Consequently, when a State and an Indian tribe tax in a functionally identical manner the same on-reservation sales to nontribal members, it is my view that congressional policy conjoined with the Indian Commerce Clause requires the State to credit against its own tax the amount of the tribe's tax. This solution fully effectuates the State's goal of assuring that its citizens who are tribal members do not cash in on the exemption from state taxation that the tribe and its members enjoy. On the other hand, it permits the tribe to share with the State in the tax revenues from cigarette sales, without at the same time placing the tribe's federally encouraged enterprises at a competitive disadvantage compared to similarly situated off-reservation businesses.
Accordingly, I would vacate the judgment of the District Court, insofar as it invalidates in toto the imposition of the State's cigarette excise and general sales taxes upon cigarette sales on the Colville, Lummi, and Makah Reservations, and remand the case for further proceedings. I would reverse the judgment of the District Court insofar as it bars the imposition of the State's taxes upon sales of cigarettes on the Yakima Reservation.
Since early in the last century, this Court has been struggling to develop a coherent doctrine by which to measure with some predictability the scope of Indian immunity from state taxation.1 In recent years, it appeared such a doctrine was well on its way to being established. I write separately to underscore what I think the contours of that doctrine are because I am convinced that a well-defined body of principles is essential in order to end the need for case-by-case litigation which has plagued this area of the law for a number of years. That doctrine, I had thought, was at bottom a pre-emption analysis based on the principle that Indian immunities are dependent upon congressional intent. McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 93 S.Ct. 1257, 36 L.Ed.2d 129 (1973); Mescalero Apache Tribe v. Jones, 411 U.S. 145, 93 S.Ct. 1267, 36 L.Ed.2d 114 (1973); Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96 (1976); Bryan v. Itasca County, 426 U.S. 373, 96 S.Ct. 2102, 48 L.Ed.2d 710 (1976), at least absent discriminatory state action prohibited by the Indian Commerce Clause. I see no need for this Court to balance the state and tribal interests in enacting particular forms of taxation in order to determine their validity. Supra, at 156-157. Absent discrimination, the question is only one of congressional intent. Either Congress intended to pre-empt the state taxing authority or it did not. Balancing of interest is not the appropriate gauge for determining validity since it is that very balancing which we have reserved to Congress. I concur in the Court's conclusion, however, that the cigarette tax is valid because Congress has not pre-empted state authority to impose the tax.
* The principles necessary for the resolution of this case are readily derived from our opinions in McClanahan and Mescalero. McClanahan confirmed the trend which had been developing in recent decades towards a reliance on a federal pre-emption analysis. Congress has for many years legislated extensively in the field of Indian affairs. McClanahan therefore recognized that the answer to most claims of Indian immunity from state power could be resolved by looking "to the applicable treaties and statutes which define the limits of state power." 411 U.S., at 172, 93 S.Ct., at 1262.2
McClanahan readily illustrates application of the analysis. The question presented in that case was whether the State of Arizona had jurisdiction to impose a tax on a reservation Indian's income derived solely from reservation sources. The Court first reviewed the "tradition of sovereignty" relevant to this "narrow question." Id., at 168, 93 S.Ct., at 1260.3 Historically this Court had found Indians to be exempt from taxes on Indian ownership and activity confined to the reservation and not involving non-Indians.4 The Kansas Indians, 5 Wall. 737, 18 L.Ed. 667 (1867). With this tradition placing reservation-ownership beyond the jurisdiction of the States, the Court undertook a review of the relevant treaties and statutes to determine whether this tradition of immunity had been altered by Congress.5 Although no legislation directly provided that Indians were to be immune from state taxation under these circumstances, the enactments reviewed were certainly suggestive of that interpretation. See Arizona Enabling Act, § 20, 36 Stat. 569; the Buck Act, 4 U.S.C. § 105. The Court therefore declined to infer a congressional departure from the prior tradition of Indian immunity absent an express provision otherwise. Thus, as this Court's opinion in Bryan v. Itasca County, supra, later characterized it, McClanahan established a rule against finding that "ambiguous statutes abolish by implication Indian tax immunities." 426 U.S., at 392, 96 S.Ct., at 2112-2113.
The Court in Mescalero applied precisely the analysis McClanahan adopted. First, the Court reviewed the tradition of sovereignty and found that no immunity for off-reservation activities had traditionally been recognized. See Shaw v. Gibson-Zahniser Oil Corp., 276 U.S. 575, 48 S.Ct. 333, 72 L.Ed. 709 (1928); Ward v. Race Horse, 163 U.S. 504, 16 S.Ct. 1076, 41 L.Ed. 244 (1896). With that tradition as its backdrop, the Court reviewed the particular statutes relevant to the question of whether or not Congress intended to immunize the Indian enterprise from the state gross receipts tax. The principal Act relevant to the inquiry was the Indian Reorganization Act, since it was the Act under which the tribal enterprise was being conducted. Section 5 of that Act, 25 U.S.C. § 465, provides that the lands acquired under authority of the Act are exempt from state and local taxation. The Court nevertheless refused to read § 5 as broadly conferring an immunity from income as well as property taxes. The Court invoked the well-established rule that " 'tax exemptions are not granted by implication,' " that such exemptions may not rest on " 'dubious inferences,' " but that they must be provided in " 'plain words.' " 411 U.S., at 156, 93 S.Ct., at 1274 quoting Oklahoma Tax Comm'n v. United States, 319 U.S. 598, 606-607, 63 S.Ct. 1284, 1287-1288, 87 L.Ed. 1612 (1943). Despite the clear federal purpose of promoting this tribal economic enterprise, the Court found that no judicial immunities could appropriately be implied.6
The subsequent Indian tax immunity cases have been unanimously resolved through application of the corollary principles of construction established in McClanahan and Mescalero. In Moe v. Salish & Kootenai Tribes, supra, the Court invalidated attempted state taxation of Indian conduct and property confined to the reservation. The Court, found, however, that imposition of a state tax on its non-Indian residents' purchases of cigarettes from Indian sellers on a reservation could not be found to "ru[n] afoul of any congressional enactment dealing with the affairs of reservation Indians." 425 U.S., at 483, 96 S.Ct., at 1646. In Bryan v. Itasca County, supra, the question was whether the congressional grant of civil jurisdiction to the States conferred by 28 U.S.C. § 1360 was a general grant of power to tax reservation Indians. The tradition, of course, was otherwise and the statute did not specifically state that a repeal of those immunities was intended. Consistent with the principles enunciated in McClanahan, the Court reasoned that
"[t]his omission has significance in the application of the canons of construction applicable to statutes affecting Indian immunities, as some mention would normally be expected if such a sweeping change in the status of tribal government and reservation Indians had been contemplated by Congress." 426 U.S., at 381, 96 S.Ct., at 2107.
At issue here is not only Indian sovereignty, but also necessarily state sovereignty as well. As a general rule, of course, States are given wide latitude in the exercise of their sovereign powers to tax. In Michelin Tire Corp. v. Wages, 423 U.S. 276, 293, 96 S.Ct. 535, 544, 46 L.Ed.2d 495 (1976), this Court cautioned against invalidating any state taxation absent "the clearest . . . mandate." Here the State attempts to tax its citizens' use of cigarettes purchased in a territory subject to the control of another sovereign.7 As a general matter, we have repeatedly held that such an exercise of state taxing power is permissible. Here there is no question that the State, by taxing its own non-Indian residents, has "exerted its power in relation to opportunities which it has given, to protection which it has afforded, to benefits which it has conferred," and "[t]he fact that a tax is contingent upon events brought to pass without a state does not destroy the nexus between such a tax and transactions within a state for which the tax is an exaction." Wisconsin v. J. C. Penney Co., 311 U.S. 435, 444-445, 61 S.Ct. 246, 250, 85 L.Ed. 267 (1940). Use tax schemes applicable to purchases in other States, precisely comparable to that in issue here, have long been upheld as a permissible exercise of state taxing power. Henneford v. Silas Mason Co., 300 U.S. 577, 57 S.Ct. 524, 81 L.Ed. 814 (1937); National Geographic Society v. California Board of Equalization, 430 U.S. 551, 97 S.Ct. 1386, 51 L.Ed.2d 631 (1977). Of course in order to collect the tax from the merchant located beyond the territorial jurisdiction of the taxing State, there must also be a relationship between the State and the burdened merchant sufficient to satisfy principles of due process. National Geographic Society, supra. After Moe, however, the retailers on the tribal reservation cannot gain invalidation of the tax on this basis. 425 U.S., at 482-483, 96 S.Ct., at 1645-1646. Thus the State has exercised its taxing authority consistent with its sovereign powers and constitutional due process.
An otherwise legitimate exercise of state taxing authority will be illegitimate, of course, if it is sought to be applied in contravention of a constitutional or federal statutory immunity. Indian sovereign immunity from nondiscriminatory taxation is a question of congressional pre-emption. As outlined, we must first identify the backdrop of sovereignty in order to interpret congressional intent in the field. As McClanahan implicitly recognized through its citation of authorities, the traditional cases clearly did not find that Indian sovereign immunity was contravened by subjecting tribes to the burdens inherent in state taxation of the reservation activities of non-Indians. Surplus Trading Co. v. Cook, 281 U.S. 647, 50 S.Ct. 455, 74 L.Ed. 1091 (1930); Utah & Northern R. Co. v. Fisher, 116 U.S. 28, 6 S.Ct. 246, 29 L.Ed. 542 (1885); Thomas v. Gay, 169 U.S. 264, 18 S.Ct. 340, 42 L.Ed. 740 (1898).
Thomas v. Gay, perhaps best illustrates the "backdrop" relevant to the State's cigarette tax in issue. In Thomas, the State attempted to tax the cattle grazing on reservation lands leased, pursuant to congressional authorization, by Indians to non-Indians. The Court found that the Indians' sovereign immunity did not operate to curtail state authority to impose this tax. The case is particularly significant because of the arguments which it expressly rejects. The tribe complained that the tax had to be invalidated because the revenues which it received as lessor would be directly reduced as a result of the state tax since lessees would be unwilling to pay the same price for tax-exempt grazing lands as for taxable grazing lands. The Court stated that it is urged that
"the money contracted to be paid for the privilege of grazing is paid to the Indians as a tribe, and is used and expended by them for their own purposes, and that if, by reason of this taxation, the conditions existing at the time the leases were executed were changed, or could be changed by the legislature of Oklahoma at its pleasure, the value of the lands for such purposes would fluctuate or be destroyed altogether according to such conditions." Id., at 273, 18 S.Ct., at 343.
Thomas v. Gay is a part of the "backdrop" which supports Washington's power to impose the tax in issue.8 The appellee Tribes maintain that the tax in issue is impermissible, though permissible in Moe, because here the Tribes are raising governmental revenues and establishing commercial enterprises. The effect of the state tax then would be to reduce the tribe's governmental revenues and force the tribe to choose between losing those revenues by forgoing its tax or subjecting reservation retailers to a competitive disadvantage compared to those retailers outside the reservation not subject to the tribal tax. These may be the facts, but they are facts which Thomas v. Gay held to be irrelevant to the recognition of a sovereign tribal immunity. In Thomas, the tribe's involvement was far more direct than that in issue here since it was a tribal leasing enterprise. There, the State's exercise of jurisdiction clearly required the tribe, as lessor, to forgo some portion of rent which could have been charged, and used the same as tax revenues, had the State not asserted its taxing authority. The tribe could recover the full rent (part of which may readily be considered the equivalent of a tax and another part perhaps proprietary profit) only at the risk of discouraging the economic enterprise. It is apparent therefore that the backdrop relevant to this action is one of no sovereign immunity.9
Congress could of course countermand this "tradition" of no immunity. But it has not done so. Under Mescalero, it is dispositive of this case that no express immunity has been granted by Congress since the tradition of sovereignty counsels against the immunity. Even going beyond the Mescalero rule against implying an immunity from taxation, I agree with the Court that a review of the statutes does not suggest, even remotely, that Congress intended either by its laws or the policies underlying them to prevent the States from taxing these transactions.10 In all areas of tax immunity, this Court has staunchly refused to consider the permissibility of a tax by reference to the economic burdens which it imposes if those burdens are nondiscriminatory and satisfy due process. See United States v. County of Fresno, 429 U.S. 452, 97 S.Ct. 699, 50 L.Ed.2d 683 (1977) (state taxation of the Federal Government); New York v. United States, 326 U.S. 572, 66 S.Ct. 310, 90 L.Ed. 326 (1946) (federal taxation of the state governments); Michelin Tire Corp. v. Wages, 423 U.S. 276, 96 S.Ct. 535, 46 L.Ed.2d 495 (1976) (state taxation of imports and exports). If Indians are to function as quasi co-sovereigns with the States, they like the States, must adjust to the economic realities of that status as every other sovereign competing for tax revenues, absent express intervention by Congress.11
Relying on the same pre-emption analysis, I also concur in the Court's conclusion that Indians not members of the governing tribe are not immune from taxation. McClanahan/Mescalero are once again dispositive. As McClanahan explained, the doctrine of sovereign immunity traditionally recognized by this court derived from the sovereign relationship between a tribe and its members, and a recognition that state jurisdiction should not be asserted in a manner which "frustrates tribal self-government." 411 U.S., at 170, 93 S.Ct., at 1261. See Williams v. Lee, 358 U.S. 217, 219-220, 79 S.Ct. 269, 270, 3 L.Ed.2d 251 (1959); Moe, 425 U.S., at 483, 96 S.Ct., at 1646. Immunities which have formed the backdrop for this Court's pre-emption analysis have been those derived from these precepts. This form of immunity, and the principles which underlie it, are simply inapplicable to the recognition of a tax immunity for an individual who resides on a reservation, but is not a member of the tribe. The holding in Moe that non-Indians, even those resident on a reservation, could be subject to cigarette taxes for on-reservation purchases, was a reflection of this principle. The fact that the nonmember resident happens to be an Indian by race provides no basis for distinction. The traditional immunity is not based on race, but accouterments of self-government in which a nonmember does not share.
Congress of course has gone beyond protection of merely Indian self-government, extending its regulatory authority to Indians not residing on the reservation of their own tribe, or, in fact, not residing on any reservation. See 25 U.S.C. § 13 (1970 ed.), as construed in Morton v. Ruiz, 415 U.S. 199, 94 S.Ct. 1055, 39 L.Ed.2d 270 (1974). See also the definition of "Indian" in the Indian Reorganization Act, 25 U.S.C. § 479. Congress, however, has certainly provided no express immunity from the type of taxation in issue for Indians not members of the tribe, and under the Mescalero principles of construction, the backdrop of sovereignty makes it clear that it is not this Court's province to imply such an immunity. These Indians residing on the reservation are citizens of the State, just the same as their non-Indian neighbors, and I am unwilling to conclude that their Indian status entitles them to an implied immunity from taxes which their non-Indian neighbors are required to pay.
I cannot concur in the Court's disposition of the challenge to the state vehicle excise tax. Wash.Rev.Code, chs. 82.44 and 82.50 (1976 and Supp.1977). The lower court did not conduct a very extensive inquiry into the mechanics or state interpretation of this excise taxing scheme, believing that the tax was clearly invalid under our prior decision in Moe. In Moe, this Court refused to uphold a State's authority to impose a property tax on motor vehicles owned by tribal members residing on the reservation. The lower court here found that Moe was controlling because in both cases the vehicles which the State seeks to tax are used both on and off the reservation, and the tax is assessed annually at a percentage of the market value of the vehicle. Thus the lower court, and this Court, have concluded that the only difference between the taxes is one of label, a difference insufficient to warrant a difference in outcome. Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977). The Court therefore looked no further to the operation of the taxing scheme in question.
I do not find the issue clearly disposed of by Moe without a dispositive construction of the actual operation of this state taxing scheme. There is of course no question that this Court has discarded the controlling significance of the label a State attaches to its taxes. A tax instead must be judged by its "practical operation." Detroit v. Murray Corp., 355 U.S. 489, 78 S.Ct. 458, 2 L.Ed.2d 441 (1958). But only if the practical operation of this excise taxing scheme is the same as the property taxing scheme addressed in Moe would the tax be invalid on the basis of that decision. In Moe, the tax was assessed on the basis of ownership, and, therefore, an Indian was required to pay the tax regardless of whether the vehicle was ever used off the reservation. If the state taxing scheme in question here, however, exacts a tax only in the event that the vehicle is used off the reservation, then the practical operation of the taxes would be totally different. In Moe, the Indian purchaser could not avoid assessment of the tax once the vehicle was purchased. It is possible, however, that under an excise taxing scheme no tax would be assessed if the vehicle were used only on the reservation.
What is dispositive for me then is whether Washington has structured or will construe its overall tax and exemption scheme so as to avoid exaction of the tax in the event the vehicle is never used off the reservation. No decision of this Court would preclude the State from taxing Indians for the use of off-reservation highways. The lower court did not appreciate the significance of this distinction and accordingly did not focus on the manner in which the state taxing scheme would be applied to Indians limiting their vehicle use to the reservation. Judge Kilkenny, in a dissenting opinion, found the record inadequate to resolve the question of validity. I agree with Judge Kilkenny that federal courts cannot invalidate state taxes without a thorough review of state law and precedents necessary to determine whether the scheme in fact contravenes federal law. It may well be that the excise tax is applicable without exception to even those Indians using their vehicles exclusively on the reservation, but I would remand the question to the lower court to clarify that this is the controlling question so that it might examine the state taxing scheme under a corrected view of what federal law requires. Cf. Perkins v. Benquet Consolidated Mining Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952); Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 578-579, 97 S.Ct. 2849, 2859, 53 L.Ed.2d 965 (1977).
Together with No. 78-60, Confederated Tribes of the Colville Indian Reservation et al. v. Washington, also on appeal from the same court but not argued. See n. 32, infra.
The state tobacco products tax, which is imposed on cigars and pipe tobacco pursuant to Wash.Rev.Code, ch. 82.26 (1976), is not before us. The District Court concluded that that tax fell upon the Indian sellers and not upon the non-Indian purchasers. 446 F.Supp. 1339, 1355, n. 15 (ED Wash. 1978). The State did not appeal from this holding, Brief for Appellants in No. 78-630, p. 55, n. 40, and all parties agree that in consequence the tobacco products tax may not be imposed on sales by trial dealers.
The Tribes also sought damages for interference with their cigarette businesses. The damages issues in both cases were remanded by the three-judge court to a single District Judge. 446 F.Supp., at 1367, 1373.
Proceedings in both cases were stayed for several months, however, pending this Court's decisions in Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96 (1976), and Bryan v. Itasca County, 426 U.S. 373, 96 S.Ct. 2102, 48 L.Ed.2d 710 (1976).
Our statement of the factual background is drawn in large measure from the opinion of the District Court, 446 F.Supp., at 1345-1349, 1368-1370.
Initially the State asserted that it could tax all tribal cigarette sales, regardless of whether the buyer was Indian or non-Indian. Its theory was that Pub.L. 280, 67 Stat. 588, granted it general authority to tax reservation Indians. After this theory was rejected in Bryan v. Itasca County, supra, the State abandoned any claim of authority to tax sales to tribal members. See 446 F.Supp., at 1346, n. 4.
Id., at 1352-1355. Essentially, the court accepted the State's contention that the tax falls upon the first event which may constitutionally be subjected to it. In the case of sales by non-Indians to non-Indians, this means the incidence of the tax is on the seller, or perhaps on someone even further up the chain of distribution, because that person is the one who first sells, uses, consumes, handles, possesses, or distributes the products. But where the wholesaler or retailer is an Indian on whom the tax cannot be imposed under McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 93 S.Ct. 1257, 36 L.Ed.2d 129 (1973), the first taxable event is the use, consumption, or possession by the non-Indian purchaser. Hence, the District Court concluded, the tax falls on that purchaser. We accept this conclusion.
The same chapter provided for an excise tax on mobile homes. Initially, the State sought to apply this tax to Indians as well; but after Bryan v. Itasca County, 426 U.S. 373, 96 S.Ct. 2102, 48 L.Ed.2d 710 (1976), and Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96 (1976), it no longer attempts to do so. 446 F.Supp., at 1365.
The Makah Tribe is organized under the Indian Reorganization Act of 1934, 48 Stat. 984, 25 U.S.C. § 461 et seq. While the Lummi and Colville Tribes do have federally-approved constitutions, they voted in 1935 not to come under that Act. 446 F.Supp., at 1345, n. 2.
The Colville Reservation encompasses 1.3 million acres in the northeastern section of Washington. It was established by Executive Order on July 2, 1872. 1 C. Kappler, Indian Affairs, Laws and Treaties 916 (2d ed. 1904).
The District Court seems to have found this contention persuasive, 446 F.Supp., at 1350, although it addressed it only briefly. Presumably it saw no need to explore the matter more fully since it was confident that the three-judge requirement had in any event been satisfied by the Tribes' challenges to the State's enforcement measures. Id., at 1350-1351.
"It is thus clear that the basis for the invalidity of these taxing measures, which we have found to be inconsistent with existing federal statutes, is the Supremacy Clause, U.S.Const., Art. VI, cl. 2, and not any automatic exemptions 'as a matter of constitutional law' either under the Commerce Clause or the intergovernmental-immunity doctrine as laid down originally in M'Culloch v. Maryland, 4 Wheat. 316, 4 L.Ed. 579 (1819). If so, then the basis for convening a three-judge court in this type of case has effectively disappeared, for this Court has expressly held that attacks on state statutes raising only Supremacy Clause invalidity do not fall within the scope of 28 U.S.C. § 2281. Swift & Co. v. Wickham, 382 U.S. 111, 86 S.Ct. 258, 15 L.Ed.2d 194 (1965). Here, however, the District Court properly convened a § 2281 court, because at the outset the Tribe's attack asserted unconstitutionality of these statutes under the Commerce Clause, a not insubstantial claim since Mescalero and McClanahan had not yet been decided. See Goosby v. Osser, 409 U.S. 512, 93 S.Ct. 854, 35 L.Ed.2d 36 (1973)." 425 U.S., at 481, 96 S.Ct., at 1645.
See Turner v. Fouche, 396 U.S. 346, 354, n. 10, 90 S.ct. 532, 537, 24 L.Ed.2d 567 (1970). See also Department of Employment v. United States, 385 U.S. 355, 87 S.Ct. 464, 17 L.Ed.2d 414 (1966); Query v. United States, 316 U.S. 486, 490, 62 S.Ct. 1122, 1124, 86 L.Ed. 1616 (1942).
The actual chronology was as follows: On May 10, 1978, the District Court entered its final order. On May 22, the State filed a motion for partial new trial on the cigarette and sales tax issues. On July 12, while that motion was pending, the State filed a notice of appeal raising the motor-vehicle-excise-tax and assumption-of-jurisdiction issues. On July 17, the motion for partial new trial was denied; and on August 14, the State filed a notice of appeal on the sales and cigarette tax issues. On September 8, the State filed an amended notice of appeal raising all relevant issues. The July 12 notice of appeal was filed more than 60 days after the original District Court order. Accordingly, under 28 U.S.C. § 2101(b), it was out of time. The notice of August 14 and the amended notice of September 8, however, were filed within 60 days of the District Court's denial of the motion for partial new trial. It seems clear that the filing of that motion rendered nonfinal the disposition of all covered issues—if not, one seeking a partial new trial would have to jeopardize his right to appeal. Communist Party of Indiana v. Whitcomb, 414 U.S. 441, 445-446, 94 S.Ct. 656, 659, 660, 38 L.Ed.2d 635 (1974); Department of Banking v. Pink, 317 U.S. 264, 266, 63 S.Ct. 233, 234, 87 L.Ed. 254 (1942). Thus, the only remaining question is whether the motion for partial new trial also suspended the finality of the District Court's disposition of issues not covered by that motion.
We struck down the tax as applied to sales to Indians. 425 U.S., at 475-481, 96 S.Ct., at 1642-1645.
Id., at 1327, citing the Montana statute, Mont.Rev.Codes Ann. § 84-406(2) (Supp.1974).
In No. 78-60, Confederated Tribes of the Colville Indian Reservation et al. v. Washington et al., which is pending on appeal, the Colville Tribe appeals from so much of the District Court's judgment as reflects the holding that Washington's assumption of total jurisdiction over that Tribe's reservation was lawful. See 446 F.Supp., at 1366-1367. The Colville Tribe challenges that holding on grounds (1) that Washington could not assume jurisdiction without amending its Constitution and (2) that the assumption of total jurisdiction over only selected reservations violates the Equal Protection Clause. Washington v. Yakima Indian Nation, 439 U.S. 463, 99 S.Ct. 740, 58 L.Ed.2d 740 (1979), disposes of the first contention, id., at 493, 99 S.Ct., at 757, and makes clear that the second must fail if the assumption of jurisdiction is rationally related to some valid state purpose, id., at 500-502, 99 S.Ct., at 761-762. We find the pattern of jurisdiction in the present case rational: The Colville Tribe consented in 1965 to the State's assumption of jurisdiction over it, and the State has assumed total jurisdiction only over tribes that have so consented. The presence or absence of tribal consent is a rational basis for distinguishing among reservations, and there is thus no constitutional infirmity. Accordingly, the judgment is in this respect affirmed.
The starkest territorial conception of Indian sovereignty was sketched by Mr. Chief Justice Marshall in Worcester v. Georgia, 6 Pet. 515, 557-561, 8 L.Ed. 483 (1832). An Indian reservation, he stated, was "a distinct community, occupying its own territory . . . in which the laws of Georgia can have no force . . . ." See F. Cohen, Handbook of Federal Indian Law 122 (1942). Williams v. Lee, 358 U.S. 217, 219, 79 S.Ct. 269, 270, 3 L.Ed.2d 251 (1959), noted that this view had been "modified . . . in cases where essential tribal relations were not involved." Kake Village v. Egan, 369 U.S. 60, 71-75, 82 S.Ct. 562, 568-570, 7 L.Ed.2d 573 (1962), noted a shift as well. And McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 172, 93 S.Ct. 1257, 1262, 36 L.Ed.2d 129 (1973), observed that "the trend has been away from the idea of inherent Indian sovereignty as a bar to state jurisdiction." Rather, McClanahan concluded, sovereignty is better seen as a "backdrop against which the applicable treaties and federal statutes must be read." Ibid. In a similar vein, Oliphant v. Suquamish Indian Tribe, 435 U.S. 191, 208, 98 S.Ct. 1011, 1021, 55 L.Ed.2d 209 (1978) recognized that Indian Tribes are "prohibited from exercising both those powers of autonomous States that are expressly terminated by Congress and those powers 'inconsistent with their status.' " (Emphasis and citations omitted.) Still, United States v. Wheeler, 435 U.S. 313, 322-326, 98 S.Ct. 1079, 1085-1087, 55 L.Ed.2d 303 (1978), emphasized the sovereign nature of tribal authority over Indians. See also Mescalero Apache Tribe v. Jones, 411 U.S. 145, 148, 93 S.Ct. 1267, 1270, 36 L.Ed.2d 114 (1973); Antoine v. Washington, 420 U.S. 194, 201-203, 95 S.Ct. 944, 949-950, 43 L.Ed.2d 129 (1975).
See Mescalero Apache Tribe v. Jones, 411 U.S., at 151-152, 93 S.Ct., at 1271-1272. There we noted that the "intent and purpose of the Reorganization Act was 'to rehabilitate the Indian's economic life and to give him a chance to develop the initiative destroyed by a century of oppression and paternalism.' " Id., at 152, 93 S.Ct., at 1272, quoting H.R.Rep. No. 1804, 73d Cong., 2d Sess., 6 (1934). The Reorganization Act itself contains a number of provisions that demonstrate Congress' concern with encouraging Indian economic development. See 25 U.S.C. §§ 469, 470, and 477. See also Santa Clara Pueblo v. Martinez, 436 U.S. 49, 59-60, 98 S.Ct. 1670, 1677-1678, 56 L.Ed.2d 106 (1978).
Adherence to the policies underlying the Reorganization Act has not been without some interruption. The Termination Acts of the 1950's see, e. g., 25 U.S.C. §§ 564, 721-728, 741-760, and 891-901 (1958 ed), seem to have signalled a congressional urge to pursue an assimilationist policy somewhat akin to the approach that was dominant prior to the Reorganization Act. See generally Menominee Tribe v. United States, 391 U.S. 404, 88 S.Ct. 1705, 20 L.Ed.2d 697 (1968). But present policy "appears to be returning to a focus upon strengthening tribal self-government." Bryan v. Itasca County, 426 U.S. 373, 389, n.14, 96 S.Ct. 2102, 2111, n.14, 48 L.Ed.2d 710 (1976).
Moe, 425 U.S., at 483, 96 S.Ct., at 1646, citing Williams v. Lee, 358 U.S., at 219-220, 79 S.Ct., at 270.
This problem was entirely absent in Moe. Nothing in the result there disfavored the purchase of Indian goods. Rather, imposition of the state tax on non-Indians simply created a situation in which persons were encouraged to buy cigarettes on the basis of factors other than tax benefits and avoidance—factors like geographical location and convenience. In the present situation, the state tax actually tips the balance against the Indians.
It might be argued that the choice I describe is entirely commonplace—that in making its taxing decisions every governmental unit is required to balance its revenue needs against the economic impact of the taxes it considers. In one sense, this is quite true: If one State has a very low sales tax, a neighboring State's ability to impose a higher one may as a practical matter be impaired. In some circumstances, it can cope with this situation by imposing a complementary tax on the in-state use of goods purchased elsewhere. National Geographic Society v. California Bd. of Equalization, 430 U.S. 551, 555, 97 S.Ct. 1386, 1389, 51 L.Ed.2d 631 (1977). And in others there will exist no efficacious way of collecting such a tax. Whatever the case, however, the two States will face each other across their common border with equal arsenals.
I think the present situation is readily distinguishable for the simple reason that Indian reservations are not States. This has two sorts of consequences. First, it means the equality noted in the preceding paragraph is absent. Moe holds that sellers on an Indian reservation may be required to collect state taxes on sales to non-Indians that occur entirely on the reservation. Yet it is highly unlikely that the Tribes in these cases could require sellers elsewhere in Washington to collect tribal taxes. And second, Indian Tribes, while less autonomous than States in important respects, are the special beneficiaries of certain federal concerns and policies. As a result, the tradeoffs and frictions that may be inevitable in the state-state context demand special scrutiny in the state-reservation context. Tribes may lack the tools needed to protect themselves and protecting them is an important federal concern. Cf. Morton v. Mancari, 417 U.S. 535, 551-555, 94 S.Ct. 2474, 2483-2485, 41 L.Ed.2d 290 (1974).
See Mescalero Apache Tribe v. Jones, 411 U.S., at 152, 93 S.Ct., at 1272 (quoting legislative history to the effect that Indians should be able to "enter the white world on a footing of equal competition").
Much of that developmental history is recounted in McClanahan v. Arizona State Tax Comm'n, 411 U.S. 164, 168-172, 93 S.Ct. 1257, 1260-1262, 36 L.Ed.2d 129 (1973).
The Court in McClanahan did not resolve to what extent residual Indian sovereignty in the total absence of federal treaty obligations or legislation still would be recognized. The Court found that "[t]he question is generally of little more than theoretical importance, . . . since in almost all cases federal treaties and statutes define the boundaries of federal and state jurisdiction." 411 U.S., at 172 n.8, 93 S.Ct., at 1262. I am convinced that this "residue" of sovereignty is no greater than the freedom from nondiscriminatory taxation held sufficient to protect sovereignty in other areas of constitutionality derived immunities. See n.9, infra. Our opinions have recognized that Indian sovereignty is dependent upon congressional preservation, see United States v. Wheeler, 435 U.S. 313, 323, 98 S.Ct. 1079, 1086, 55 L.Ed.2d 303 (1978), and I decline to use our adjudicatory powers to assume a role properly reserved to Congress.
The Court emphasized that its review of Indian sovereignty was relevant only to this narrow category, i. e., the reservation-derived income of a reservation Indian, and that the Court was expressly not reviewing any situation in which the State attempted to exert is sovereignty over non-Indians undertaking activity on Indian reservations. 411 U.S., at 168, 93 S.Ct., at 1260.
I use "Indians" throughout this discussion of sovereignty immunity to refer to members of a reservation tribe. See infra, at 186-187.
The Court has explicitly held that attributes of Indian sovereignty are subject to complete defeasance by Congress. United States v. Wheeler, supra, at 323, 98 S.Ct., at 1086.
In addition, the Court expresses the opinion that congressional policy was not at odds with state taxation since Congress intended that the Indians be prepared to "enter the white world on a footing of equal competition." 411 U.S., at 157, 93 S.Ct., at 1275.
Indian reservations are not or course subject to the exclusive control of the tribe. The Federal Government and the States also have jurisdiction for some purposes.
It should be noted that the principles in Thomas v. Gay were not always those used to determine Indian immunities. A series of decisions, as noted in McClanahan, treated Indian immunities as derivative from the Federal Government's immunity from state taxation. During the reign of the treatment of Indian reservations as federal instrumentalities for purposes of state taxation, this Court did prohibit States from taxing the net income derived by the lessees of Indian lands. Gillespie v. Oklahoma, 257 U.S. 501, 42 S.Ct. 171, 66 L.Ed. 338 (1922). See also Choctaw, O. & G. R. Co. v. Harrison, 235 U.S. 292, 35 S.Ct. 27, 59 L.Ed. 234 (1914); Indian Territory Illuminating Oil Co. v. Oklahoma, 240 U.S. 522, 36 S.Ct. 453, 60 L.Ed. 779 (1916). While Thomas v. Gay was never explicitly overruled, these decisions were clearly inconsistent. Nevertheless, it was the line of analysis employed in Gillespie that was later overruled in Helvering v. Mountain Producers Corp., 303 U.S. 376, 58 S.Ct. 632, 82 L.Ed. 907 (1938). Thomas v. Gay stands as the traditional analysis of Indian sovereign immunity held to be relevant in McClanahan.
This conclusion derives support from not only Thomas v. Gay but also analogous applications of sovereign tax immunities. When two sovereigns have legitimate authority to tax the same transaction, exercise of that authority by one sovereign does not oust the jurisdiction of the other. If it were otherwise, we would not be obligated to pay federal as well as state taxes on our income or gasoline purchases. Economic burdens on the competing sovereign also do not alter the concurrent nature of the taxing authority. Decisions of this Court unequivocally recognize that a state tax comparable to that in issue, imposed on its residents' transactions in another State, or on a federal enclave, will not be barred by force of the respective immunities of that State or the Federal Government. In Henneford v. Silas Mason Co., 300 U.S. 577, 57 S.Ct. 524, 81 L.Ed. 814 (1937), this Court upheld a state tax on one of its resident's use of goods purchased in another State without regard to the fact that the other State's competitive ability to tax the same transaction was obviously reduced. The Court observed that such a tax was permissible even if no credit for the other state tax were allowed. Id., at 581, 57 S.Ct., at 526. See also National Geographic Society v. California Board of Equalization, 430 U.S. 551, 97 S.Ct. 1386, 51 L.Ed.2d 631 (1977). Even the sovereign immunity of the Federal Government would not prevent the effects of a tax comparable to those in issue. In United States v. County of Fresno, 429 U.S. 452, 97 S.Ct. 699, 50 L.Ed.2d 683 (1977), the State sought to impose a possessory use tax on federal employees occupying federal housing located in federal enclaves within the State of California. This Court upheld the tax even though it accepted the Federal Government's argument that in order to remain competitive as an employer or landlord, it would have to reimburse the employees for the payment of the added cost. Id., at 464, and n. 12, 97 S.Ct. at 705. See also United States v. Detroit, 355 U.S. 466, 472, 78 S.Ct. 474, 477, 2 L.Ed.2d 424 (1958); Alabama v. King & Boozer, 314 U.S. 1, 12, 62 S.Ct. 43, 46, 86 L.Ed. 3 (1941). Thus the State, through its exercise of taxing authority, can effectively require the Federal Government to forgo revenues which would otherwise be available to it in order to remain competitive as an enterprise.
The total absence of any suggestion that Congress intended to confer the immunity sought in this action should not be surprising. As this Court has found, other statutes are premised on congressional "recognition of the imperative need of a State to administer its own fiscal operations," free from federal interference. Tully v. Griffin, Inc., 429 U.S. 68, 73, 97 S.Ct. 219, 222, 50 L.Ed.2d 227 (1976). In Tully, this congressional policy was not found to be diminished even though the State sought to assert its taxing authority over nonresidents.
These considerations, determinative in other areas of tax immunity law, are equally appropriate when one of the taxing jurisdictions is an Indian tribe. While Indian tribes are not States, the tribes are also not helpless hostages of the State absent judicial intervention. Two substantial sources of protection are available to them. First, the Indians could not be subjected to the burdens of discriminatory taxation, e. g., a state tax on only cigarette purchases on a reservation with no corresponding off-reservation tax. The prohibition of discriminatory taxation has been recognized by this Court as a substantial safeguard against the potential for any abusive taxation since only those taxes which the general population are willing to withstand can be imposed. See County of Fresno, supra, at 463, n. 11, 97 S.Ct., at 705, n. 11; Alabama v. King & Boozer, supra (federal immunity); Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977) (state taxation of interstate commerce). Second, Indian tribes are always subject to protection by Congress. This source of protection is more than adequate to preclude any unwarranted interference with tribal self-government. Congress, and not the judiciary, is the forum charged with the responsibility of extending the necessary level of protection beyond that inherent in prohibiting nondiscriminatory taxation.