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State judge refuses to block sales tax collection on Native American cigarettes

By Eileen Buckley

Buffalo, NY – A state supreme court judge won't block the state from collecting taxes on Native American cigarettes sold to non-Indians.

The Seneca Nation of Indians was seeking to block the state's new tax law that is slated to go into effect September 1.

Arguments were heard in state Supreme Court Monday.

According to the Associated Press, a lawyer for the Senecas argued that state officials circumvented proper procedures by adopting emergency rules outlining how the $4.35 per pack tax would be imposed. The Senecas say a 2009 court order blocking the state from taxing cigarette sales to non-Indian customers should remain in place. The state argues the new regulations make the order moot and it should be lifted.

State Supreme Court Justice Donna Siwek issued the decision.

The judge lifted two previous injunctions. Both had prevented the state from collecting sales tax on Native American cigarette sales.

In issuing the ruling, Judge Siwek said she found that the set met its burden.

Seneca Nation president Barry Snyder issued a written statement on the state Supreme Court ruling.

"We are disappointed State Supreme Court Justice Siwek did not keep the tax impositions injunction in place, however, our legal efforts are far from over. We will be filing an expedited appeal motion with the Appellate Division of State Supreme Court and we remain hopeful Judge Arcara will grant our request a Temporary Restraining Order in the separate Federal case. We will return to federal court tomorrow afternoon to renew our motion for the TRO. It is our intention to block the New York State from ever collecting a penny of tax on sales of tobacco by the Seneca Nation or any other Native American nation under this ill-conceived taxing scheme."

Meanwhile, the Senecas are also awaiting another decision in federal court. The Seneca Nation is seeking a restraining order that would temporarily block the state from enforcing the new tax laws. U.S. District Court Judge Richard Arcara reserved decision on Friday and could issue his ruling Tuesday.