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- NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
- being done in connection with this case, at the time the opinion is issued.
- The syllabus constitutes no part of the opinion of the Court but has been
- prepared by the Reporter of Decisions for the convenience of the reader.
- See United States v. Detroit Lumber Co., 200 U. S. 321, 337.
-
- SUPREME COURT OF THE UNITED STATES
-
- Syllabus
-
- DEPARTMENT OF TAXATION AND FINANCE OF
- NEW YORK et al. v. MILHELM ATTEA
- & BROS., INC., et al.
- certiorari to the court of appeals of new york
- No. 93-377. Argued March 23, 1994-Decided June 13, 1994
-
- Enrolled tribal members purchasing cigarettes on Indian reservations
- are exempt from a New York cigarette tax, but non-Indians mak-
- ing such purchases are not. Licensed agents precollect the tax by
- purchasing stamps and affixing them to cigarette packs in advance
- of their first sale. Determining that a large volume of unstamped
- cigarettes was being purchased by non-Indians on reservations,
- petitioner tax department enacted regulations imposing record-
- keeping requirements and quantity limitations on cigarette whole-
- salers selling untaxed cigarettes to reservation Indians. As rele-
- vant here, the regulations set quotas on the quantity of untaxed
- cigarettes that wholesalers may sell to tribes and tribal retailers,
- and petitioner must approve each such sale. Wholesalers must
- also ensure that a buyer holds a valid state tax exemption certifi-
- cate, and must keep records of their tax-exempt sales, make
- monthly reports to petitioners, and, as licensed agents, precollect
- taxes on nonexempt sales. Respondent wholesalers are licensed by
- the Bureau of Indian Affairs to sell cigarettes to reservation
- Indians. They filed separate suits in state court alleging that the
- regulations were pre-empted by the federal Indian Trader Statutes.
- The trial court issued an injunction. Ultimately, the Appellate
- Division upheld the regulations, but the Court of Appeals reversed,
- distinguishing this Court's decisions upholding taxes imposed on
- non-Indian purchasers of cigarettes, see Moe v. Confederated
- Salish and Kootenai Tribes of Flathead Reservation, 425 U. S. 463;
- Washington v. Confederated Tribes of Colville Reservation, 447
- U. S. 134, on the ground that they involved regulating sales to
- non-Indian consumers whereas New York's regulations applied to
- sales by non-Indian wholesalers to reservation Indians. The court
- concluded that the Indian Trader Statutes, as construed in Warren
- Trading Post v. Arizona Tax Comm'n, 380 U. S. 685, deprived the
- States of all power to impose regulatory burdens on licensed
- Indian traders, and, alternatively, that if States could impose
- minimal burdens on the traders, the State's regulations were
- invalid because the burdens were significant.
- Held: New York's regulations do not, on their face, violate the
- Indian Trader Statutes. Pp. 6-16.
- (a) Because respondents have made essentially a facial chal-
- lenge, this case is confined to those alleged defects that inhere in
- the regulations as written, and the Court need not assess for all
- purposes each feature of the tax scheme that might affect tribal
- self-government or federal authority over Indian affairs. Pp. 6-7.
- (b) Indian traders are not wholly immune from state regulation
- that is reasonably necessary to the assessment or collection of
- lawful state taxes. Although broad language in Warren Trading
- Post suggests such immunity, that proposition has been under-
- mined by subsequent decisions in Moe (upholding a state law
- requiring Indian retailers on tribal land to collect a state cigarette
- tax imposed on sales to non-Indians), Colville (upholding in rele-
- vant part a state law requiring tribal retailers on reservations to
- collect cigarette taxes on sales to nonmembers and to keep exten-
- sive records), and Oklahoma Tax Comm'n v. Citizen Band of
- Potawatomi Tribe of Okla., 498 U. S. 505. These cases have made
- clear that the States have a valid interest in ensuring compliance
- with lawful taxes that might easily be evaded through purchases
- of tax-exempt cigarettes on reservations; that interest outweighs
- tribes' modest interest in offering a tax exemption to customers
- who would ordinarily shop elsewhere. Thus, there is more room
- for state regulation in this area. In particular, these cases have
- decided that States may impose on reservation retailers minimal
- burdens reasonably tailored to the collection of valid taxes from
- non-Indians. It would be anomalous to hold that a State could
- impose tax collection and bookkeeping burdens on reservation
- retailers who are enrolled tribal members but not on wholesalers,
- who often are not. Pp. 7-13.
- (c) New York's scheme does not impose excessive burdens on
- Indian traders. Respondents' objections to the regulations setting
- quotas and requiring that petitioner preapprove deliveries provide
- no basis for a facial challenge, although the possibility of inade-
- quate quotas may provide a basis for a future challenge to the
- regulations' application. The requirements that wholesalers sell
- untaxed cigarettes only to persons with valid exemption certificates
- and keep detailed records are no more demanding than comparable
- measures approved in Colville. Moreover, the precollection obliga-
- tion placed on wholesalers is the same as the obligation that,
- under Moe and Colville, may be imposed on reservation retailers.
- The United States' arguments supporting its position that the
- scheme improperly burdens Indian trading are also rejected.
- Pp. 13-16.
- 81 N. Y. 2d 417, 615 N. E. 2d 994, reversed.
- Stevens, J., delivered the opinion for a unanimous Court.
-