House Committee on Ways and Means schedules first ever hearing on tribal taxation

Monday, March 2, 2020  

WASHINGTON, D.C. -- The Democratic-led House Committee on Ways and Means will be taking up tribal taxation issues for the first time at a hearing on Wednesday

Rep. Dan Kildee (D-Michigan), a member of the committee, told tribal leaders about the hearing last month. He said it would examine the ways in which federal policy hinders economic development in Indian Country by failing to take tribal sovereignty into account.

"The failure to recognize the status of tribal governments in tax law has led to all sorts of inequities," Kildee told the National Congress of American Indians during the organization's winter session in D.C.

Mark your calendars! At National Congress of American Indians, Rep. Dan Kildee (D-Michigan) announces “first ever” hearing on tribal taxation and economic development before the House Ways & Means Committee. Will be on March 4. #ECWS2020 @RepDanKildee @NCAI1944 @WaysMeansCmte pic.twitter.com/SD8zXyBG51

— indianz.com (@indianz) February 11, 2020

The inequities include dual taxation of tribal business activities by states and local governments. Billions of dollars -- whether it's revenues derived from energy development or sales of basic goods and products -- are falling out of Indian hands as a result.

"Eliminating double taxation on Indian reservations would produce tens of billions of dollars in economic stimulus without costing federal taxpayers a single penny," Grover G. Norquist, the president of Americans for Tax Reform, a group that has strong influence among Republicans, said in a letter to every member of Congress last month. "Fixing this issue would result in economic growth in every state that has an Indian reservation."

Dual taxation is just one of several topics discussed by the U.S. Congress Joint Committee on Taxation in a report prepared for the hearing. The 62-page document provides a non-partisan overview of the ways in which federal, state and local taxes are imposed on tribes and individual tribal citizens. It also looks at specific federal programs, such as tax credits and economic development incentives, that are supposed to benefit Indian Country.

"Indian tribes have an inherent sovereign power to tax transactions that occur on certain Indian lands and that significantly involve the Indian tribe or its members,' the joint committee, which consists of members of both the U.S. House of Representatives and the U.S. Senate, wrote in the report. "Because both Indian tribes and states have the right to tax certain transactions of non-members of Indian tribes within Indian country, instances of double taxation may not be relieved unless one or the other jurisdiction cedes its authority to tax the transaction, for example by permitting a tax credit."

The hearing before the Select Revenue Measures Subcommittee takes place at 10am Eastern in Room 1100 of the Longworth House Office Building. A witness list hasn't been posted online.

Select Revenue Measures Subcommittee Hearing on Examining the Impact of the Tax Code on Native American Tribes (March 4, 2020)

Joint Committee on Taxation: Overview Of Federal Tax Provisions And Analysis Of Selected Issues Relating To Native American Tribes And Their Members (February 28, 2020)