Appeals court rules cigarette company must pay federal taxes

YAKIMA, Wash. (AP) — The 9th U.S. Circuit Court of Appeals has ruled that a cigarette manufacturer on the Yakama Nation Indian Reservation is on the hook for $58 million in unpaid federal taxes.

The Yakima Herald-Republic reports the court opinion filed Monday rejects arguments by King Mountain Tobacco, which claimed it was exempt from federal excise taxes because of a treaty and other tribal land laws.

The tobacco company is privately owned but licensed by the tribe. A U.S. District Court judge had ruled that it was responsible for the taxes.

The appeals court affirmed the lower court decision, ruling that “Indians — like all citizens — are subject to federal taxation unless expressly exempted by a treaty or congressional statute.”

The newspaper could not immediately reach attorneys for King Mountain on Tuesday.