Tribes Could Benefit From Cigarette Tax, Retailers Not So Much
Tribes could benefit from cigarette tax increase — or not
By Randy Krehbiel, Tulsa World
Tribal treasuries could be collateral beneficiaries of a state cigarette tax increase, but it’s not clear Oklahoma’s Indian nations are all that eager for such a potential windfall.
Almost no one in state or tribal government is willing to talk about it on the record, but the proposed $1.50 cigarette tax increase wafting through the Capitol smells like trouble to at least some tribes as well as state officials and most non-tribal retailers.
The non-tribal retailers are afraid they are going to get squeezed out by the tribes; the tribes are concerned they will be squeezed out by the state, and looming over all is the threat of legal action nobody really wants.
At issue are the tobacco compacts more than 30 tribes have with the state, most of them signed or updated since 2013. Under the terms of those compacts, tribal smoke shops collect the equivalent of the applicable state tax on tobacco products, which is then divided with Oklahoma.