Wagnon v. Prairie Band Potawatomi Nation: State Tax on Motor Fuels Distributed to Indian Tribal Retailers (CRS Report for Congress)
| Release Date |
Revised Dec. 9, 2005 |
| Report Number |
RS22321 |
| Report Type |
Report |
| Authors |
M. Maureen Murphy, American Law Division |
| Source Agency |
Congressional Research Service |
| Older Revisions |
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Summary:
On December 6, 2005, the U.S. Supreme Court, in Wagnon v. Prairie BandPotawatomi Nation (No. 94-631), upheld the application of a non-discriminatoryKansas motor fuels tax to gasoline sold by off-reservation distributors to Indian tribalretailers for on-reservation sales. Important to the Court's reasoning were: (1) the factthat the state law specified that the legal incidence of and the liability for paying the taxfell on the distributor; (2) that the transaction being taxed,the receipt of the motor fuelsin Kansas by the distributor,took place off-reservation; and (3) that the state taxes werebeing passed on to beneficiaries of state services,the non-Indian patrons of the tribalgasoline operation and its gaming casino. Wagnon follows a series of cases that haveupheld state authority to tax on-reservation tobacco and gasoline sales to non-tribalmembers, but which have raised questions about the ability of states to collect thesetaxes because of the bar that tribal sovereign immunity imposes to enforcement actionsagainst Indian tribes. Although legislation has been introduced in several recentCongresses to compel tribes to remit state sales taxes on retail sales to non-Indians, todate no such requirement has been enacted.
