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    NY Governor Wants To Collect Taxes from Native American Reservations

    Paterson says competition forcing upstate c-stores out of business.

    ALBANY -- New York Gov. David Paterson said he aims to stop upstate convenience stores and gas stations from going out of business because of unfair competition from Native American reservations.

    Paterson told WOR's "The John Gambling Show" he wants to collect taxes on cigarettes on reservations and has been in contact with U.S. attorneys because treaties are a federal issue.

    "When we go in there, we don't expect to be going in there alone," Paterson said. "We want to have an organized law enforcement team."

    New York is seeking federal law enforcement help over the state's failure, over 30 years, to collect taxes from stores on reservations, according to a Reuters report.

    New York estimates uncollected taxes on tobacco and fuel from reservation stores would be nearly half a billion dollars a year. A number of court decisions and state legislation have not settled the issue, the report noted.

    "It is a question of law enforcement, that's why we are approaching federal law enforcement," the Democratic governor told a Webcast meeting with legislative leaders.

    Native American tribes say that as sovereign nations, they are immune from tax claims.

    New York's last serious enforcement effort dates back to 1997, when former Republican Governor George Pataki backed down after 12 state troopers were injured during protests by two upstate tribes, Reuters noted.

    Last year cigarette-maker Philip Morris supported a state Assembly bill to solve the problem by collecting the levy from wholesalers who sell cigarettes to reservation stores. New York City Mayor Michael Bloomberg sued eight Native American reservation stores on Long Island over the issue.

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