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Matched Legal Cases: ['§ 2281', '§ 82', '§ 82', '§ 82', '§ 458', '§ 82', '§ 2281', '§ 2101', '§ 16', '§ 476', '§ 461', '§ 1451', '§ 450', '§ 261', '§ 461', '§ 1360', '§ 13', '§ 479']

US Supreme Court Decisions On-Line> Volume 447 > WASHINGTON V. CONFEDERATED TRIBES, 447 U. S. 134 (1980)
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These cases concern challenges of several Indian Tribes to efforts by the State of Washington to apply various state taxes and other laws to transactions and activities occurring on Indian reservations. Washington imposes a cigarette excise tax on the "sale, use, consumption, handling, possession or distribution" of cigarettes within the State. It also imposes a general retail sales tax on sales of personal property, including cigarettes. The State sought to compel Indian retailers to collect both taxes with respect to sales of cigarettes to non-Indians, and the latter tax with respect to sales of other goods as well. In addition, the State sought to apply its motor vehicle excise tax and mobile home, camper, and trailer taxes -- which are imposed for the privilege of using the covered vehicles in the State -- to vehicles owned by the Tribes or their members and used both on and off the reservation. Finally, the State took steps to assume civil and criminal jurisdiction over the affected reservations. The Indian Tribes involved in this litigation have each adopted ordinances imposing their own taxes upon on-reservation sales of cigarettes. In actions brought in Federal District Court, they sought declaratory and injunctive relief against enforcement of the state sales and cigarette taxes, and in particular against the State's seizure of untaxed cigarettes destined for delivery to the reservations, contending that those taxes could not lawfully be applied to tribal cigarette sales. In addition, the Tribes challenged the State's efforts to apply its vehicle excise taxes to Indian-owned vehicles, and asserted that the State's assumption of jurisdiction was invalid. The complaints alleged, inter alia, that the challenged taxes were contrary to the Indian Commerce Clause. Because injunctive relief against enforcement of state statutes was sought, a three-judge District Court was convened pursuant to the then applicable requirement of 28 U.S.C. § 2281 (1970 ed.) that an injunction restraining the enforcement of any state statute shall not be granted chanrobles.com-red
(a) The Tribes have the power to impose their cigarette taxes on nontribal purchases, since the power to tax transactions occurring on trust lands and significantly involving a tribe or its members is a fundamental attribute of sovereignty which the tribes retain unless divested chanrobles.com-red
(f) The State may validly require, as a minimal burden, the tribal smokeshops to affix tax stamps purchased from the State to individual chanrobles.com-red
WHITE, J., delivered the opinion of the Court, in which BURGER, C. J., and BLACKMUN, POWELL, and STEVENS JJ., joined; in Parts I, II, III, IVÑB(1), IVÑD, V, and VI of which BRENNAN and MARSHALL, JJ., joined; in Parts I, II, III, IV (except IV-B(2)), and VI of which STEWART, J., joined; and in Parts I, II, III, IV-C, IV-E, and VI of which REHNQUIST, J., joined. BRENNAN, J., filed an opinion concurring in part and dissenting in part, in which MARSHALL, J., joined, post, p. 447 U. S. 164. STEWART, J., filed an opinion concurring in part and dissenting in part, post, p. 447 U. S. 174. REHNQUIST, J., filed an opinion concurring in part, concurring in the result in part, and dissenting in part, post, p. 447 U. S. 176. chanrobles.com-red
In recent Terms, we have more than once addressed the intricate problem of state taxation of matters involving Indian tribes and their members. Moe v. Salish & Kootenai Tribes, 425 U. S. 463 (1976); McClanahan v. Arizona State Tax Comm'n, 411 U. S. 164 (1973); Mescalero Apache Tribe v. Jones, 411 U. S. 145 (1973). We return to that vexing area in the present cases. Although a variety of questions are presented, perhaps the most significant is whether an Indian tribe ousts a State from any power to tax on-reservation purchases by nonmembers of the tribe by imposing its own tax on the transaction, or by otherwise earning revenues from the tribal business. A three-judge District Court held for the Tribes. We affirm in part and reverse in part chanrobles.com-red
These cases are here on the State of Washington's appeal from declaratory judgments and permanent injunctions entered by the District Court at the close of consolidated proceedings in two separate cases that raised related issues. 446 F.Supp. 1339 (ED Wash.1978). The first case, Confederated Tribes of the Colville Indian Reservation v. State of Washington, Civ. No. 3868, was filed on May 17, 1973, by the Confederated Tribes of the Colville Reservation (Colville), Makah, and Lummi Tribes. The second, United States of America and Confederated Bands and Tribes of the Yakima Indian Nation v. State of Washington, Civ. No. 3909, was commenced on July 18, 1973, by the United States on behalf of the Confederated Bands and Tribes of the Yakima Indian Nation (Yakima Tribe). [Footnote 1] In each action, the complainants contended that the State's cigarette and tobacco products taxes [Footnote 2] could not lawfully be applied to sales by on-reservation tobacco outlets. They sought declaratory judgments to that effect, as well as injunctions barring the State from taking any measures to enforce the challenged taxes. In particular, the plaintiffs sought to enjoin the State from seizing as contraband untaxed cigarettes destined for delivery to their reservations. [Footnote 3] In the Colville case, the Tribes also challenged chanrobles.com-red
Trial was held in both cases on March 28, 1977, and the three-judge court entered its consolidated decision on February 22, 1978. The court concluded (1) that it had jurisdiction as a three-judge court to consider the issues presented; (2) that the state cigarette tax could not be applied to on-reservation transactions, because it was preempted by the tribal taxing ordinances and constituted an impermissible interference with tribal self-government; (3) that the state chanrobles.com-red
The State of Washington levies a cigarette excise tax of $1.60 per carton, [Footnote 7] on the "sale, use, consumption, handling, possession or distribution" of cigarettes within the State. Wash.Rev.Code § 82.24.020 (1976). The tax is enforced with tax stamps; and dealers are required to sell only cigarettes to which such stamps have been affixed. § 82.24.030. Indian tribes are permitted to possess unstamped cigarettes for purposes of resale to members of the tribe, but are required by regulation to collect the tax with respect to sales to nonmembers. § 82.24.260; Wash.Admin.Code § 458-20-192 chanrobles.com-red
The state motor vehicle excise tax is imposed on "the privilege of using in the state any motor vehicle." Wash.Rev.Code § 82.44.020 (Supp. 1977). The tax is assessed annually, and during the relevant period the amount was 2% chanrobles.com-red
Each of the Tribes involved in this litigation is recognized by the United States as a sovereign Indian tribe. Each is governed by a business or tribal council approved by the Secretary of the Interior. [Footnote 11] The Colville Tribe has some 5,800 members, of whom about 3,200 live on the Colville Indian Reservation. [Footnote 12] Enrolled members of the Tribe constitute just under half of the reservation's population. The Lummi Tribe has approximately 2,000 members. Roughly 1,250 of them live on the reservation. [Footnote 13] The Makah Tribe has about 1,000 members. Some 900 live on the reservation. [Footnote 14] The Colville, Lummi, and Makah Reservations are isolated and underdeveloped. Many members reside in mobile homes. Most own at least one automobile which is used both on and off the reservation. chanrobles.com-red
While the Colville, Lummi, and Makah Tribes function as retailers, retaining possession of the cigarettes until their sale to consumers, the Yakima Tribe acts as a wholesaler. It purchases chanrobles.com-red
The original complaints in these actions contended that the state taxes were unconstitutional under the Indian Commerce chanrobles.com-red
Clause as well as the Supremacy Clause. Relying primarily upon language in footnote 17 in Moe v. Salish & Kootenai Tribes, 425 U.S. at 425 U. S. 481, the United States asserts that the Tribes' Commerce Clause claims were insubstantial. [Footnote 21] But Moe was decided in 1976 -- long after a three-judge court was convened to hear these cases -- and it is thus apparent that footnote 17 alone cannot be dispositive, whatever its precise thrust. There is language in that footnote, however, which suggests that the insubstantiality of Commerce Clause claims such as those before us flows from Mescalero Apache Tribe v. Jones, 411 U. S. 145 (1973), and McClanahan v. Arizona State Tax Comm'n, 411 U. S. 164 (1973) -- both of which were decided before the present suits were filed. [Footnote 22] We think the United States reads too much into this language. Goosby v. Osser, supra, made it clear that constitutional claims will not lightly be found insubstantial for chanrobles.com-red
In addition, it seems quite clear that the Tribes' attack on the official seizure of cigarettes bound for the reservations also triggers the three-judge requirement of § 2281. The United States concedes that that attack raised Commerce Clause issues, but maintains that the Tribes' target was not really the state enforcement statutes themselves, but rather the discretionary official conduct undertaken pursuant to those statutes. We have no quarrel with the proposition that the mere fact that executives seek shelter under various state statutes will not necessarily convert a suit to restrain their lawless behavior into a 2281 case, Phillips v. United States, 312 U. S. 246, 312 U. S. 248-253 (1941). But this is not a situation in which the only connection with state statutes arises when officials accused of taking various ultra vires actions seek to trace their conduct back to vague statutes granting them broad executive discretion. Here the state officials involved were attempting to enforce the state tax laws by using the tools authorized for such enforcement by the state legislature. They manifested an intention to continue to use those tools for that purpose. And it is those tools, as applied to cigarettes in Indian commerce, which the Tribes challenged. [Footnote 23] chanrobles.com-red
The other jurisdictional question postponed in 1979 is relevant only to the Colville case. It concerns the timeliness under 28 U.S.C. § 2101(b) of the State's appeal from the District Court's resolution of the motor vehicle tax and assumption of jurisdiction issues. Basically, the problem is this: the notice of appeal on these two issues was filed more than 60 days after the District Court's decision, but within 60 days of the denial of a state motion for partial new trial -- a motion that was not addressed to the motor vehicle tax and assumption of jurisdiction issues. The question is whether a motion for partial new trial renders nonfinal the District Court's holding on all issues between the parties, or merely renders nonfinal the disposition of those issues actually raised in the new trial motion. If the former, the State's notice of appeal on the vehicle taxes and assumption of jurisdiction issues was timely. If the latter, that notice was filed out of time, and, to that extent, the appeal is jurisdictionally time-barred. [Footnote 24] chanrobles.com-red
In Moe v. Salish & Kootenai Tribes, 425 U. S. 463 (1976), we considered a state taxing scheme remarkably similar to the cigarette and sales [Footnote 25] taxes at issue in the present cases. Montana there sought to impose a cigarette tax on sales by smokeshops operated by tribal members and located on leased trust lands within the reservation, and sought to require the smokeshop operators to collect the tax. We upheld the tax, insofar chanrobles.com-red
Although it narrows the issues in the present cases, Moe does not definitively resolve several important questions. First, unlike in Moe, each of the Tribes imposes its own tax on cigarette sales, and obtains further revenues by participating in the cigarette enterprise at the wholesale or retail level. Second, Washington requires the Indian retailer to keep detailed records of exempt and nonexempt sales in addition to simply pre-collecting the tax. Moe expressed no opinion chanrobles.com-red
The widely held understanding within the Federal Government has always been that federal law to date has not worked a divestiture of Indian taxing power. Executive Branch officials have consistently recognized that Indian tribes possess a broad measure of civil jurisdiction over the activities of non-Indians on Indian reservation lands in which the tribes have a significant interest, 17 Op.Atty.Gen. 134 (1881); 7 Op.Atty.Gen. chanrobles.com-red
Federal courts also have acknowledged tribal power to tax non-Indians entering the reservation to engage in economic activity. Buster v. Wright, 135 F.9d 7, 950 (CA8 1905), appeal dism'd, 203 U.S. 599 (1906); Iron Crow v. Oglala Sioux Tribe, 231 F.2d 89 (CA8 1956); cf. Morris v. Hitchcock, 194 U. S. 384, 194 U. S. 393 (1904). No federal statute cited to us shows any congressional departure from this view. To the contrary, authority to tax the activities or property of non-Indians taking place or situated on Indian lands, in cases where the tribe has a significant interest in the subject matter, was very probably one of the tribal powers under "existing law" confirmed by § 16 of the Indian Reorganization Act of 1934, 48 Stat. 987, 25 U.S.C. § 476. In these respects, the present cases differ sharply from Oliphant v. Suquamish Indian Tribe, 435 U. S. 191 (1978), in which we stressed the shared assumptions of the Executive, Judicial, and Legislative Departments that Indian tribes could not exercise criminal jurisdiction over non-Indians.
Tribal powers are not implicitly divested by virtue of the tribes' dependent status. This Court has found such a divestiture in cases where the exercise of tribal sovereignty would be inconsistent with the overriding interests of the National Government, as when the tribes seek to engage in foreign relations, alienate their lands to non-Indians without federal chanrobles.com-red
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) preempted 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. chanrobles.com-red
The federal statutes cited to us, even when given the broadest reading to which they are fairly susceptible, cannot be said to preempt 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 (1965), but no similar intent is evident chanrobles.com-red
Williams v. Lee, 358 U. S. 217, 358 U. S. 220 (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 411 U. S. 179. 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 chanrobles.com-red
We cannot fault the State for not giving credit on the amount of tribal taxes paid. It is argued that if a credit is not given, the tribal retailers will actually be placed at a competitive disadvantage, as compared to retailers elsewhere, due to the overlapping impact of tribal and state taxation. While this argument is not without force, we find that 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. With a credit, prices at the smokeshops would presumably be roughly the same as those off the reservation, assuming that the Indian enterprises are operated at an efficiency similar to that of businesses chanrobles.com-red
A second asserted ground for the invalidity of the state taxes is that they somehow conflict with the Tribes' cigarette ordinances, and thereby are subject to preemption or contravene the principle of tribal self-government. This argument need not detain us. There is no direct conflict between the state and tribal schemes, since each government is free to impose its taxes without ousting the other. Although taxes can be used for distributive or regulatory purposes, as well as for raising revenue, we see no nonrevenue purposes to the tribal taxes at issue in these cases and, as already noted, we perceive no intent on the part of Congress to authorize the Tribes to preempt otherwise valid state taxes. Other provisions chanrobles.com-red
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 recordkeeping 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 chanrobles.com-red
Federal statutes, even given the broadest reading to which they are reasonably susceptible, cannot be said to preempt Washington's power to impose its taxes on Indians not members of the Tribe. We do not so read the Major Crimes Act, chanrobles.com-red
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 chanrobles.com-red
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. [Footnote 29] chanrobles.com-red
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 chanrobles.com-red
I agree with the Court's analysis of the jurisdictional questions posed in these cases, as well as with its treatment of the chanrobles.com-red
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. [Footnote 2/1] The result has been to blur the chanrobles.com-red
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 (1973), and tribal laws will often govern the on-reservation conduct of non-Indians. @ 358 U. S. 557-558 (1975). [Footnote 2/2]
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 preemption. 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. 426 U. S. 376, n. 2 (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, at 425 U. S. 481, n. 17; McClanahan v. Arizona State Tax Comm'n, [email protected] at 411 U. S. 172.
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, 435 U. S. 322-326 (1978); Fisher v. District Court, supra at 424 U. S. 386-388; McClanahan v. Arizona State Tax Comm'n, supra at 411 U. S. 179; Williams v. Lee, supra, at 358 U. S. 219-220. 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., [Footnote 2/3] and are manifest in more recent statutes as well. [Footnote 2/4] They are, chanrobles.com-red
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 chanrobles.com-red
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 chanrobles.com-red
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. [Footnote 2/6] 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 358 U. S. 219-220. [Footnote 2/7] chanrobles.com-red
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. chanrobles.com-red
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 chanrobles.com-red
The starkest territorial conception of Indian sovereignty was sketched by Mr. Chief Justice Marshall in 31 U. S. 557-561 (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, 358 U. S. 219 (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, 369 U. S. 71-75 (1962), noted a shift as well. And McClanahan v. Arizona State Tax Comm'n, 411 U. S. 164, 411 U. S. 172 (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, 435 U. S. 208 (1978), recognized that Indian tribes are
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 chanrobles.com-red
Turning to the case at hand, the approach I have outlined leads me to one conclusion with respect to sales on the Colville Lummi, and Makah Reservations, and another with respect to sales on the Yakima Reservation. The Colville, Lummi, and Makah Tribes each collect from the operators of on-reservation tobacco outlets a tax of 40 to 50 cents per carton. Although in each case the tax is imposed at the time the cigarettes are distributed by the Tribe to the retail outlets, the pertinent taxing ordinance requires that the tax be passed on to the ultimate consumer. Thus, the actual event taxed, as with the State's cigarette excise tax and general sales tax, is the sale to the nontribal purchaser. Since the Tribe's cigarette tax operates in functionally the same way as do the State's cigarette excise and general sales taxes, I would hold that the chanrobles.com-red
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. [Footnote 3/1] 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. chanrobles.com-red
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 preemption 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 411 U. S. 172. [Footnote 3/2] chanrobles.com-red
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 411 U. S. 168. [Footnote 3/3] 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. [Footnote 3/4] @ 72 U. S. 392.
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. Glibson-Zahniser Oil Corp., 276 U. S. 575 (1928); Ward v. Race Horse, 163 U. S. 504 (1896). With that tradition as its backdrop, the Court reviewed the particular statutes relevant to the question of whether or not Congress intended chanrobles.com-red
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, 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 425 U. S. 483. 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 chanrobles.com-red
At issue here is not only Indian sovereignty, but, 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, 423 U. S. 293 (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. [Footnote 3/7] As a general matter, we have repeatedly held that such an exercise of state taxing power is permissible. Here there is no question chanrobles.com-red
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 preemption. 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 (1930); Utah & Northern R. Co. v. Fisher, 116 U. S. 28 (1885); Thomas v. Gay, 169 U. S. 264 (1898). chanrobles.com-red
Thomas v. Gay is a part of the "backdrop" which supports Washington's power to impose the tax in issue. [Footnote 3/8] The appellee chanrobles.com-red
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. [Footnote 3/9] chanrobles.com-red
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 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. [Footnote 3/10] In all areas of tax immunity, this Court has staunchly refused to consider the permissibility of a tax by chanrobles.com-red
Relying on the same preemption 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 chanrobles.com-red
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 (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. chanrobles.com-red
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 (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 chanrobles.com-red
Assuming a construction which excludes reservation use, arguendo, I do not find it significant that Washington has not tailored this tax to the "amount of actual off-reservation use," in which case the Court suggests this tax might be permissible. A non-Indian resident of the State of Washington pays the same tax on his use of the public highways whether he drives his car once a year or every day. We have certainly never held that a State is under an obligation to apportion chanrobles.com-red
411 U.S. at 411 U. S. 172, n. 8. 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 constitutionally derived immunities. See 447 U. S. 323 (1978), and I decline to use our adjudicatory powers to assume a role properly reserved to Congress.