Tribes in North Dakota are unenthusiastic about draft legislation that would allow them to collect sales tax on their reservations, including casinos and spend the money on tribal services.
Ron His Horse is Thunder, the former chairman of the Standing Rock Sioux Tribe, testifying before the state’s Tribal Taxation Issues Committee, which is headed by Governor Doug Burgum said the revenues from casinos go for “essential government services” and should not be taxed.
He said the tribe’s casino revenues should be treated no different than revenues from other tax-free institutions such as the state owned bank in Bismarck.
This is the second attempt to impose a state sales tax on the tribe. The first was cancelled two years ago after the tribe wouldn’t collect from its casino.
The state has five tribes. The legislation came because those tribes have expressed concerns that federal money to them is decreasing.
The chairman of the Senate Finance and Taxation Committee, Senator Dwight Cook, who authored the bill said that while the bill would allow the tribes to impose a sales tax, it wouldn’t force them to. “Only the tribes can decide whether they want to impose the tax on their members,” he said.
The draft legislation would prevent tribes from imposing additional tribal taxes if they sign a compact with the state to collect sales taxes.
Some tribes maintain that it is unlawful for North Dakota to collect sales tax on tribal land without the tribes’ permission.
The bill seems to be a work in progress and will probably change as more legislators join the debate. Nothing will happen until January, when the legislature will return to session.
Currently businesses that are operating inside the reservation but are not owned by tribal members are required to collect the sales tax from non-tribal members. Tribal businesses do not.
Some tribes collect additional revenue by imposing a taxation rate on oil production on reservation land. Others collect additional taxes on alcohol sales for non-tribal businesses.
