The U.S. Court of Appeals for the Eighth Circuit today released two decisions in cases concerning an Indian tribe’s liability for South Dakota sales and use tax.
The Eighth Circuit in an unofficial summary of one of the cases provided the following:
The Eighth Circuit held that the Indian Gaming Regulatory Act does not expressly preempt the imposition of the use tax on nonmember purchases throughout the casino but that the tax is preempted because the revenues generated by the sales of the amenities contribute significantly to the economic success of the tribe's Category III gaming at the casino, and imposition of the tax would be contrary to the law’s broad policies of increasing tribal revenue and ensuring the tribes are the primary beneficiaries of gaming revenue. The appeals court further found that the state may condition renewal of the alcoholic beverage licenses on the tribe's failure to remit the validly imposed portions of the use tax, and the district court's holding that it could not, is reversed.
The case is: Flandreau Santee Sioux Tribe v. Noem, No. 18-1271 (8th Cir. September 6, 2019). Read the Eighth Circuit’s decision [PDF 62 KB] (that includes an opinion that dissents in part and concurs in part).
In the second case, the Eighth Circuit concluded that the Indian Gaming Regulatory Act does not preempt the imposition of South Dakota's statewide tax on the gross receipts of a nonmember contractor for services performed in renovating and expanding the tribe's gaming casino located on the reservation; that the tribe failed to show the tax has more than a de minimis financial impact on federal and tribal interests; and that the state's legitimate interests in raising revenue for essential government programs which benefit the nonmember contractor-taxpayer in this case is sufficient to justify imposing the excise tax.
The case is: Flandreau Santee Sioux Tribe v. Haeder, No: 18-2750 (8th Cir. September 6, 2019). Read the Eighth Circuit’s decision [PDF 114 KB] (that includes concurring and dissenting opinions).
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