August 19, 2010 - An increase in tobacco taxes and a plan to collect taxes from cigarettes sold on American Indian reservations was approved Monday, June 21st by New York State lawmakers. (New York State - tobacco taxes increase, will be highest in nation once again..; New York State - as of August 1st OTPs tax goes up such as little cigars will be taxed at same rate as cigarettes..)
The Seneca Indian Nation sued the Governor Paterson administration in U.S. District Court in Buffalo on Tuesday, August 17th to block enforcement of a plan to gain tax collections on sales of cigarettes at Native American stores. Papers were filed around 5 p.m. naming Governor David Paterson, Acting Tax Commissioner Jamie Woodward and the State Police.
The Seneca tribal government said in a statement that a complaint was filed in the Western District of New York challenging "as substantively infirm" recent amendments to state Tax Law and emergency regulations put forth by the Department of Taxation and Finance in an effort to implement the new statutes.
The tax collection is supposed to commence September 1, 2010.
In the meantime, the tribal government -- which is supported by other tribes -- is appealing to Paterson and Attorney General Andrew Cuomo to hold off on implementing the collection program while the case is in the court.
Court papers say the Seneca have a tribal tax stamp already, and that the "well-regulated tobacco economy" supports 18 Seneca-licensed stamping agents and 140 licensed cigarette retailers, all of which employ about 3,000 Indian and non-Indian workers. The tribe intends to file a motion for a preliminary injunction and a temporary restraining order Friday and ask for a court hearing on August 27. 2010.
Related news brief: Mail order cigarette sellers from the Seneca Nation and elsewhere were handed another setback at federal court..
Reference: Senecas file suit to block state tax by JAMES M. ODATO Capitol Bureau, Times Union, 8/18/2010.