Africa and Aboriginal Tuesdays: Inside The Dispute Between The State Of New York and The Seneca Nation

There is an interesting new website out, Honor Indian Treaties, advocating on behalf of the expressed interests of the Seneca Nation juxtaposed to the state of New York's taxation and laws, all in the context of America's history of violating its treaties with Native Americans.

The Seneca Nation of Indians has a total population of over 7,200 enrolled members and is one of the six tribes of the Iroquois Confederacy who occupy aboriginal lands in New York State set aside by the Treaty of Canandaigua of 1794. The Seneca Nation holds title to four reservations in New York, one of which includes the City of Salamanca.

Currently they are embroiled in a controversy and dispute with New York over plans to implement regulations that would place a sales tax on petroleum and tobacco products sold on Indian lands, and over the Internet. The Seneca Nation argues this would violate sacred treaties between the U.S. and Indian tribes.

Here, from the website, are questions and answers pertaining to the issue:

Q: What is New York State proposing to do?

A: In an effort to shore up its budget deficit and appease convenience store owners, New York State has set a plan in motion that would tax the petroleum and tobacco products sold on Indian reservations. This would violate a series of treaties, including 1842's Buffalo Creek Treaty, which confirmed that status of the Seneca Nation as a sovereign nation that is immune from taxation.

Q: Why is the Seneca Nation fighting this?

A: Because it’s unconstitutional, unethical and unfair. Article 6 Clause 2 of the U.S. Constitution calls treaties “the supreme law of the land” and the Buffalo Creek Treaty of 1842 clearly defines the Seneca Nation as immune from taxes. Thanks to this treaty and the initiative of hundreds of entrepreneurs, the Senecas have built their steadily improving economy around the sale of gasoline and cigarettes. Taxing their core products would lead to widespread economic hardship for the Seneca entrepreneurs and their employees, both Indian and non-Indian alike. This is an overt and blatant attack on the sovereignty of the Seneca Nation.

Q: Who is pushing for the sales tax regulations?

A: A well-financed and organized coalition of convenience store owners who monopolize the market in New York State. Because they can’t stand the thought of any “outsiders” taking away a share of the profits, they have successfully lobbied state elected officials to impose these illegal taxes.

Q: Are Indians tax exempt?

A: Indians pay federal income taxes and are only exempt from New York State tax if we live and work on reservations. Otherwise, we pay state taxes, just like other New Yorkers.

Q: Are Indian businesses tax exempt?

A: As a sovereign nation, Indian-owned businesses on a tribe’s official territory do not add state sales tax onto the goods they sell and therefore do not remit the sales tax to the respective governments. They do, however, charge and remit federal tax, where applicable, on goods sold.

Q: Specifically which treaty says that the Seneca Nation is immune from taxes?

A: The Buffalo Creek Treaty of 1842 clearly spells out a policy of non-taxation. Article 9 from the 1842 treaty says:

“The parties to this compact mutually agree to solicit the influence of the Government of the United States to protect the lands of the Seneca Indians, within the State of New York, as may from time to time remain in their possession from all taxes, and assessments for roads, highways, or any other purpose until such lands shall be sold or conveyed by the said Indians…”


Q: What is Governor Pataki’s position on this issue?

A: Governor Pataki has called this latest tax scheme unconstitutional and “an assault on the sovereignty of Indian Nations.” When taxes were attempted to be levied on the New York’s Indian reservations in 1997, the governor and Seneca Nation leaders worked to resolve the issue, with the government agreeing to abandon its latest effort to undermine Indian sovereignty.

Q: What would happen if the sales tax regulations were enacted?

A: Indian business owners would no longer be able to compete with non-Indian businesses without the sales tax immunity that is legally provided by our treaties. This would cause over 1,000 Indians and non-Indians to lose their livelihood.

Q: Why should New Yorkers care if these regulations are enacted?

A: Because these regulations would break treaties, and according to the Constitution, if you break a treaty, you break the supreme law of the United States. According to a recent survey, two-thirds of the respondents said they support the current no sales tax policy. It’s clear that most New Yorkers agree that we don’t want to be the type of state that disregards the U.S. Constitution.

Q: What happened in 1997?

A: New York State was facing similar financial difficulties and attempted to tax Indian Nations on the sales of gasoline and cigarettes sold on Indian territory. The Seneca Nation refused to give in to the government’s illegal tactics and to retaliate, the state impounded shipments of gasoline and tobacco products. In a frustrated effort to draw attention to the state’s unfair practices, some members of the Seneca Nation protested on the New York State Thruway. The public support for the Seneca position was overwhelming and, eventually, Governor Pataki recognized the unethical nature of the mandate and rescinded the sales tax.

Q: Have you talked to Governor Pataki about this? What has he told you?

A: In the past, the governor has called efforts to tax Indian sales of gasoline and tobacco products “unconstitutional,” and reaffirmed his respect for Indian sovereignty. “Make no mistake about it,” the governor said in a May 1997 press release, “The Indians’ needs are real and all New Yorkers must be sensitive to them.” Since the draft regulations were announced, the governor has been relatively quiet on this issue, but we are confident that once the facts are presented to him again and he realizes the seriousness of the implications, he will come to the same conclusion he did in 1997 and make an effort to repeal the mandate that calls for taxing gasoline and cigarette products sold on Indian reservations.

Q: Now that Indian Nations make profits from casino gaming, why is the gas and cigarette business important?

A: In the case of the Seneca Nation, our new casino will help our Nation’s bottom line in the long run, but it is still in its infancy. The individually-owned cigarette and gasoline businesses are the foundation of our economy. If our people lose these businesses, our economy would be severely compromised.

Q: Now that the Indian nations are beginning to prosper, isn’t it only fair that they contribute to the state’s financial well being?

A: Indian Nations help the non-Indian community in a variety of ways. By building businesses and becoming self-sufficient, we alleviate the amount of aid necessary from non-Indian governments. In addition, our gaming compacts call for us to share tens of millions of dollars with New York State every year.

Q: The treaties are old documents. Times have changed. Why should we still abide by what sounded like a good idea 150 years ago or longer?

A: Keeping one's word is a concept that knows no expiration date. The Senecas are true to their word. If we enter into an agreement we stick with it. For example, for 99 years the Seneca Nation had a lease agreement for the city of Salamanca, N.Y. that paid the Nation less than $1 per parcel. In the later years this was not even a fraction of what the property was worth, but we held to the agreement for the full 99 years.

Q: Smoking is bad for health. Won’t these tax regulations benefit New Yorkers by making it a little more difficult to acquire cigarettes?

A: This isn’t about smoking, this is about doing what’s right and honoring treaties— documents that are called “the supreme Law of the Land” by the U.S. Constitution. If you break a treaty, you break the law. There are many ways the government can protect New Yorkers’ health without breaking the supreme law of the United States.

Q: Won’t these sales tax regulations help make it harder for minors to buy cigarettes?

A: All Seneca retailers do everything we can to ensure that tobacco products don’t get into the hands of minors. However, that’s not what this issue is about. This is about doing what’s right and honoring treaties— documents that are called “the supreme Law of the Land” by the U.S. Constitution. If you break a treaty, you break the law. There are many ways the government can protect New Yorkers’ health without breaking the supreme law of the United States.

Q: Does the Seneca Nation own its own land?

A: The Seneca Nation has owned its current territory since before recorded history. This is not land that was given to us by the United States or the state of New York. This is land we always owned. It’s important to remember that the United States and state of New York were built around the Seneca Nation.

Q: Aren’t some of New York’s Indian Nations entering into tax compacts with the state? Isn’t that a good solution?

A: Every Indian Nation is a separate and sovereign government. So it is up to each Nation to decide how they are going to react to these proposed tax regulations. For the Seneca Nation, this is an issue that goes far beyond the taxes themselves. This issue is about respect for our sovereignty and respect for the treaties we have honored for hundreds of years. The treaties allow our people to operate businesses that are immune from taxation and New York State must honor them.

Tuesday, January 20, 2004