ALBANY, NY – The state’s highest court, the New York State Court of Appeals, has ruled against a Seneca Nation businessman, who challenged the state’s collection of taxes on non-native cigarettes sold at reservation shops.
The man who challenged the law, Eric White, owns several smoke shops, a tobacco wholesaling business, and recently made news for starting construction on what sources say is an off ramp from the Thruway onto his property on the Cattaraugus Reservation, in protest for his loss in an unrelated tax case.
White, through his attorney Paul Cambria, challenged the validity of a law enacted by the state in 2010, seeking to collect tax on all cigarettes sold on Indian reservation to non-Indians.
The state began doing so by having the tax assessed at the wholesale level, before they are even shipped to the reservation, which is why reservation shops stopped selling non-native, or “premium brand” cigarettes years ago.
At the crux of the case which Cambria argued before the high court in April, is another statute passed a century before...called Section 6 of the state’s Indian Law.
It states:
“No taxes shall be assessed, for any purpose whatever, upon any Indian reservation in this state, so long as the land of such reservation shall remain the property of the nation, tribe or band occupying the same.”
In its ruling, however, the Court of Appeals said the statute does not provide relief for the plaintiff (White) because the state’s practice does not constitute a tax on the on Indian retailers, but rather on the consumer, to whom the cost associated with the pre-collected tax would eventually be passed.
The decision by the Court of Appeals was a unanimous, 7-0 ruling.