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Oklahoma Business Files Suit after State, Tribe Impose Taxes

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TULSA, Okla. (AP) — A grocery store chain filed a second lawsuit in Tulsa federal court asking a judge to determine whether one of its stores should be subject to sales tax for the Oklahoma Tax Commission, while also paying sales tax to the Muscogee (Creek) Nation.

Filed Tuesday by Warehouse Market Inc., the lawsuit asks for a judge to decide whether the Oklahoma Tax Commission can require the business to impose state and local sales taxes at its Okmulgee store because the grocery store is located on land owned by individual tribal members rather than the tribe, according to Tulsa World.

“The federal question presented is whether the State of Oklahoma can collect sales tax on retail sales at Warehouse Market’s Okmulgee store, which is located on restricted Indian land,” according to the lawsuit.

The grocery store said it had to pay 6% tax on sales for the month of October to the tribe as well as 10.083% sales tax to the Oklahoma Tax Commission. It claims it has been threatened with fines, interest, revocation of business licenses and even closure if it did not remit sales taxes to both entities.

The commission cited U.S. Supreme Court rulings, in which it says the court has acknowledged that certain economic activity may be taxed by both a state and a tribe.

The Muscogee (Creek) Nation stated in a state court filing that the grocery store may be subject to both tribal, state and local sales taxes so long as tribal members are exempt from non-tribal sales taxes when the purchase occurs on land held in trust for a federally recognized Indian tribe.

A spokesperson for the commission declined to comment on the federal lawsuit, saying it has yet to be served.

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