The Problem of Double-Taxation in Indian Country

Abstract

Just as anthonomus grandis, the boll weevil, migrated into the United States as an invasive species to suck the life out of cotton crops, so too are state “tax weevils” crossing into Indian Country to suck the life out of tribal economies. The founding fathers were fully aware of the grave threat to tribal economies posed by the states; thus they gave Congress the exclusive “power to ...regulate Commerce...with the Indian Tribes.”

This article analyzes the impact of state tax weevils on tribal economies and examines the history of tribal law and policy from an economic perspective, focusing on the history of the Indian Trader Act. This article also critiques Supreme Court jurisprudence, particularly when it strayed from the principles excluding state taxation and regulation in a series of cases, culminating in Cotton Petroleum, which ultimately led to a race-based taxation system. The article concludes by providing guiding principles for the development of revised Indian Trader regulations and summarizes supportive comments from throughout Indian Country.

A previous, and expanded, version of this article is available at http://ssrn.com/abstract=3017298.