Today, the Native American Financial Services Association (“NAFSA”) submitted comments to the Department of the Interior’s Advance Notice of Proposed Rule Making regarding Indian Trader Regulations, a collection of federal rules that manage certain business relationships on tribal lands. As tribes enter the field of e-commerce, it is critical that federal laws keep pace with the rapidly digitizing world and the growing ability of tribes to conduct business from tribal lands with companies and consumers across the United States and around the world.
It is long past time to bring tribal self-determination to Indian trade and commerce. Tribes can regulate commerce within their reservations with more certainty and efficiency than the current, outdated Indian Trader regulations allow. Indeed, these regulations were last updated in 1984, nearly two decades before the term “e-commerce” was coined and web-based business transactions were commonplace.
As tribes enter the field of e-commerce, it is critical that federal laws keep pace with the rapidly digitizing world and the growing ability of tribes to conduct business from tribal lands with companies and consumers across around the world. Modern Indian Trader Regulations must reflect the market realities of a closing digital divide and the nature of online transactions that originate on tribal lands with distant parties. NAFSA member tribes originate approximately $2 billion in loans each year via the internet and work closely with service providers off reservation. Nimble federal regulation of these relationships is important to the long-term viability and sustainability of web-based enterprises on tribal lands.
NAFSA’s comments can be summarized into four main areas of concern:
- Regulatory change is absolutely necessary to promote the sovereign authority of tribes to create a fiscal environment to stimulate the flow of investment, technology and services to Indian Country.
- The regulations should address the discriminatory effect of singling out commercial activity and natural resource development in Indian Country with dual taxation.
- State and local taxation also threatens substantial tribal interests in effective tribal government, economic self-sufficiency and territorial autonomy.
- Uncertainty as to taxing jurisdiction and one’s ultimate tax burden is seen as the single greatest impediment to non-Indian investment and location of businesses in Indian Country.
“Dual taxation” has long been a concern of NAFSA and many tribes and Native organizations and presents a real competitive disadvantage to tribal economic development.
“The failure of states to reinvest the tax revenue they receive from Indian commerce back into Indian Country does serious harm to tribes, their citizens and the neighboring communities,” said NAFSA Executive Director Gary Davis. “This is harm that the Department should address through reform of the Trader Regulations.”
This antiquated law is fundamentally unfair to tribal governments, undermines the Constitution’s promise of respect for tribal sovereignty, and keeps Indian reservations the most underserved communities in the nation.
We applaud the Department of Interior for undertaking this rulemaking process, and hope to work with those in charge of updating and ultimately implementing these regulations to ensure Indian Country’s needs are met.
NAFSA’s comments can be viewed here.