[Congressional Record Volume 144, Number 67 (Friday, May 22, 1998)]
[Extensions of Remarks]
[Pages E956-E957]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 A BILL TO RESTORE EQUITY TO THE COLLECTION AND PAYMENT OF MOTOR FUEL 
                     TAXES ON NATIVE AMERICAN LANDS

                                 ______
                                 

                            HON. RAY LaHOOD

                              of illinois

                    in the house of representatives

                          Friday, May 22, 1998

  Mr. LaHOOD. Mr. Speaker, today, I am introducing a bill that will 
help restore integrity and equity to the process of the collection and 
payment of motor fuel taxes on Native American lands. I am pleased to 
be able to introduce this bill with the support of 8 bipartisan 
cosponsors: Representative Sandlin (D-TX), Representative Istook (R-
OK), Representative Danner (D-MO), Representative Blunt (R-MO), 
Representative Coburn (R-OK), Representative Bill Barrett (R-NE), 
Representative Doc Hastings (R-WA), and Representative Ehler (R-MI).
  Taxes placed on the sale of motor fuels directly supports the efforts 
of state and federal governments in building and repairing our nation's 
roads and bridges. In order for our states to play their role in our 
transportation system, they need to be sure that they are collecting 
all of their motor fuel taxes. Unfortunately, that is not currently the 
case. Currently, some Native American tribes do not always collect and 
remit gas tax receipts to the appropriate government. This practice has 
cost the states a significant amount of revenue that could have been 
used to improve roads and bridges. Lost revenue estimates for some 
states are in the millions. It is estimated that Oklahoma, alone, lost 
roughly $13 million in motor fuel tax receipts for FY '96. Many other 
states are also adversely affected, for example: Washington State, 
Oregon, Idaho, New Mexico, Kansas, Michigan, and New York.
  The bill that I am introducing seeks to address this problem. It will 
prohibit the Secretary of Transportation from allocating funds for 
public lands highways on Indian lands and reservations unless either 
(a) the Indian tribe has entered into a written agreement with the 
state in which the highway is located that provides procedures for the 
payment and collection of motor fuel taxes that are sold to a non-
Native American by a retail establishment that is located on such land, 
or (b) the Indian tribe refuses to enter into a written agreement and/
but the allocation of funds is essential to the construction or 
maintenance of a highway or road that is a critical component of the 
National Highway System.
  The primary aim of this plan is to ensure that non-Native Americans 
pay and are assessed the gas tax. This plan is not intended

[[Page E957]]

to infringe on tribal sovereignty, rather, it is meant to encourage the 
tribes to work cooperatively with the states in order to formulate a 
mutually-agreeable compact on the subject of motor fuel taxation. In 
addition, this bill does not address the issues of gambling or 
cigarette taxes--it focuses only on the collection and remission of 
motor fuel taxes.
  This bill will yield numerous benefits. First, it would help ensure 
that states have adequate funds for road maintenance and construction. 
Second, it would end an inherent unfairness posed by the sale of tax-
free fuel on Native American lands. And, third, it would preserve jobs 
and keep businesses open. Many purchasers of motor fuel, both gasoline 
and diesel, are likely to travel to Indian lands, because they know 
they can avoid paying state motor fuel taxes. And, the motive to do 
this can be great for many drivers. In fact, in some states, the tax on 
gasoline can be as high as 34 cent per gallon and 28 cents per gallon 
for diesel.
  The sale of tax-free fuel poses serious concerns for retailers who 
must pay the tax and who are located within a reasonable distance of 
the Indian reservation, because the Native American retail 
establishments, by selling gas at a lower price (i.e., without the tax) 
have the potential to put countless numbers of establishments out of 
business. For example, avoiding the tax on diesel fuel for a typical 
truck with a 250 gallon tank could mean a savings of $70--a 
sufficiently large amount to justify a trucker traveling to Native 
American lands to refuel his or her truck. At the very least, a trucker 
could plan or time his, or her, routes to ensure that they purchase 
tax-free fuel on Native American lands.
  I urge Members to consider the impacts caused by the non-collection 
and remission of motor fuel taxes on Native American lands and to 
cosponsor this legislation.

                          ____________________