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Supreme Court to Review American Indian Tax Case

WASHINGTON -- The Supreme Court said Monday that it would clarify when governments can tax Indian property, reported the Associated Press. The city of Sherrill, N.Y., and the state of New York had asked justices to review a lower court's decision barring the taxation of a gas station-convenience store and a textile plant owned by the Oneida Indian Nation.

The Bush administration urged the court to stay out of the extended fight between the Oneidas and the government over land. Justices announced that they would hear arguments in the case, likely in the fall.

The Oneida Indians of New York, Wisconsin and Ontario have been in a long-running lawsuit against New York State for the return of 250,000 acres the state purchased from the tribes in the 18th and 19th centuries.

The Supreme Court case involves "only a tiny fraction" of the disputed land, Solicitor General Theodore Olson told justices in a filing. He said the Oneida Indians reacquired some properties within the boundaries of the reservation that was recognized by the U.S. government in a 1794 treaty.

The 2nd U.S. Circuit Court of Appeals ruled that the Indian-owned land couldn't be taxed by the state or local government.

Ira Sacks, the attorney for Sherrill, told the court that the New York Oneidas ceased to exist as a tribe in the late 19th and early 20th centuries and lost the right to have untaxable "Indian country." Sacks said if the appeal court decision stands, "the tax base and viability of cities such as the city of Sherrill -- across New York and elsewhere -- will be imperiled." He said Sherrill is New York's smallest city, covering one and a half square miles with about 3,000 residents.

The case is Sherrill v. Oneida Indian Nation of New York, 03-855.
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