CHAPTER 54

(SB 226)

Tax collection agreements with Indian tribes, provisions revised.

         ENTITLED, An Act to  revise certain provisions regarding tax collection agreements between the state and Indian tribes and to declare an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:

     Section  1.  That § 10-12A-1 be amended to read as follows:

     10-12A-1.   Terms as used in this chapter , unless the context otherwise requires, mean:

             (1)      "Department," the South Dakota Department of Revenue;

             (2)     "Indian country," those areas subject to federal and tribal jurisdiction as defined in 18 U.S.C. §   1151 (a) and (c) ; and

             (2) (3)      "Tribal tax," any sales or cigarette tax imposed by an Indian tribe on persons subject to the Indian tribe's taxing powers.

     Section  2.  That § 10-12A-2 be amended to read as follows:

     10-12A-2.   The Legislature finds that the public interest of both Indians and non-Indians is best served by close cooperation between the state government and the Indian tribes. The Legislature finds this cooperation to be especially important in the area of taxation. Accordingly, the Legislature hereby authorizes the State Department of Revenue department is hereby authorized to enter into tax collection agreements with Indian tribes.

     Section  3.  That § 10-12A-3 be repealed.

     Section  4.  That § 10-12A-4 be amended to read as follows:

     10-12A-4.   The State Department of Revenue department may enter into tax collection agreements with any Indian tribe under the provisions of this chapter and chapter 1-24. These agreements may provide for the collection of any tribal sales and service, use, cigarette, and contractors' excise tax or any other tax or fee by the State Department of Revenue for the Indian tribe of the following state taxes and any tribal taxes imposed by a tribe that are identical to the following state taxes:

             (7)    The fuel excise tax imposed by chapter 10-47B .

     The agreement may provide for the retention by the State Department of Revenue department of an agreed-upon percentage of the gross revenue as an administrative fee.

     Section  5.  That § 10-12A-4.1 be amended to read as follows:

     10-12A-4.1.   Any tax collection agreement entered into pursuant to this chapter shall be is binding and effective only after it is approved by the Governor and attorney general of the State of South Dakota. Prior to approval by the Governor and the attorney general, notice of the pending agreement shall be published by the Department of Revenue department in the legal newspaper of the county or counties to be affected by the agreement, not less than two weeks prior to approval.

     Section  6.  That § 10-12A-5 be amended to read as follows:

     10-12A-5.   A tax collection agreement between the State Department of Revenue department and an Indian tribe may provide, if agreed upon by the parties, that a fixed percentage of the total annual state and tribal tax proceeds from an area of Indian country shall be remitted to the Indian tribe in lieu of the exact amount of the revenue collected as a result of the imposition of tribal taxes.

     Section  7.  That § 10-12A-6 be amended to read as follows:

     10-12A-6.   Any tax collection agreements between the State Department of Revenue department and an Indian tribe shall be for a term not to exceed five years. Such agreement, however, shall be is renewable upon expiration by the mutual consent of the parties.

     Section  8.  That § 10-12A-7 be repealed.

     Section  9.  That § 10-12A-8 be amended to read as follows:

     10-12A-8.   Except as specifically set out in §   10-12A-3, nothing Nothing in this chapter may be construed to relinquish any jurisdiction the state might have to levy or collect from any person any tax or fee within Indian country.

     Section  10.  That chapter 10-12A be amended by adding thereto a NEW SECTION to read as follows:

     The authority granted by subdivision 10-12A-4(7) is hereby revoked if the South Dakota Supreme Court or the United States Supreme Court rules that the Hayden-Cartwright Act, 4 U.S.C. §  104, authorizes the state to impose state motor fuel taxes on enrolled tribal members on Indian country controlled by the member's tribe.

     Section  11.  Whereas, this Act is necessary for the support of the state government and its existing public institutions, an emergency is hereby declared to exist, and this Act shall be in full force and effect from and after its passage and approval.

     Signed March 25, 2003.

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