Archive for Friday, August 13, 2004

Court: Tribe should receive fuel taxes

August 13, 2004

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— The state cannot impose its taxes on gasoline and diesel fuel sold at a filling station owned by the Prairie Band Potawatomi tribe, a federal appeals court has ruled.

A three-judge 10th U.S. Circuit Court of Appeals panel said the Potawatomi tribe's need to impose its own fuel taxes -- and the federal government's goal of having tribes be self-sufficient -- outweigh the state's need to raise revenue.

"We conclude that the Kansas tax, as applied here, is pre-empted because it is incompatible with and outweighed by the strong tribal and federal interests against the tax," Senior Judge Monroe G. McKay wrote in the panel's opinion, issued Wednesday.

The tribe sued the secretary of revenue in 1999 to prevent Kansas from imposing and collecting its tax on its fuel sales.

In a statement Thursday, Zachariah Pahmahmie, Potawatomi tribal chairman, called the ruling "an important victory that supports the inherent sovereign authority of Indian tribes in Kansas and everywhere."

"It is unfortunate that it has required five years of litigation to have these tribal rights upheld," he said.

James Bartle, the Department of Revenue's general counsel, said the agency is reviewing the decision.

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