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ALBANY, N.Y. -- State Assemblyman David R. Townsend Jr. and Dabiew's Market, a New York Association of Convenience Store (NYACS) member and family-run convenience store located in Franklin County, N.Y. filed a lawsuit in the state Supreme Court against Gov. Eliot Spitzer and Tax Commissioner Robert Megna, in efforts to compel the government to uphold a state law requiring collection of taxes on Native American sales of cigarettes and gasoline to non-Native Americans, NYACS stated.
Dabiew's Market, located in Bombay, N.Y., lost hundreds of non-Native American customers to neighboring Mohawk Indian retailers, due to price advantages from the lack of collection of state taxes on products, according to the association.
"It's tough enough for any small business to survive in the upstate economy," Don Dabiew, co-owner of Dabiew's Market, said in a statement. "But it's almost impossible when the state chases away half your customers to a competitor that isn't required to play by the same rules."
The suit seeks an order for the Department of Taxation and Finance to immediately enforce Sections 471-e and 482-e of the Tax Law, which took effect March 1, 2006, and directs the department to collect the taxes from wholesalers for the tribes, the association stated.
The suit is supported by NYACS, which estimated that the lack of enforcement costs licensed non-Native American retailers more than $1 billion annually in lost sales, and costs taxpayers at least $500 million annually in lost revenue to the state, NYACS stated.
"Tax collection is mandatory in order to insure that a level playing field exists for all businesses, Indian and non-Indian alike," Townsend said in a statement. "Last May, I stood in front of Arnott's Gas and Convenience store in Verona and demanded that Governor Spitzer start immediate collection of sales and excise taxes from the Oneidas and all the other Indian tribes across the state, so that good taxpaying citizens like the Arnotts can remain open and competitive."
He noted that since then, Arnott's was forced to close.
"Governor Spitzer repeatedly promised he’d start collecting these taxes," James Calvin, president of NYACS, said in a statement. "Yet here we are, more than a year after 'Day 1' and the only thing that has changed is the rising number of hard-working families that are losing their livelihoods."