On the Supreme Court Docket: Tribal Case of Taxing Travel or Trade

The issue in Washington State Department of Licensing v. Cougar Den Inc. is whether the “right to travel” provision of the Yakama Nation Treaty preempts Washington’s tax and permit requirements for importing fuel.

Article III of the Yakama Nation Treaty of 1858 states that “the right of way, with free access from the same to the nearest public highway, is secured to [the Yakama]; as also the right, in common with citizens of the United States, to travel upon all public highways.”

Washington State law imposes a tax on fuels used for the propulsion of motor vehicles on the highways of the state. The Washington State Department of Licensing sued Cougar Den for importing fuel without an importer’s license and without paying taxes. Cougar Den is owned by a member of the Yakama Nation and is located on the Yakama Indian Reservation in Washington State. Cougar Den argues it is able to transport fuel from Oregon to the reservation without complying with Washington State laws per the “right to travel” provision of the Yakama Nation Treaty.  

The Supreme Court has held that Native Americans are subject to state tax laws “absent express federal law to the contrary,” but treaties are express federal laws “interpreted as the Indians would have understood them.” The Court has also held that “pure regulatory restrictions may be validly applied to tribal members.”

The Washington Supreme Court held that the Yakama’s right to travel for trade purposes was protected by the Yakama Nation Treaty, and thus Cougar Den was not subject to the fuel tax and permit requirements. The state court relied on the historical context surrounding the “right to travel” provision that has been developed at length in Ninth Circuit cases to conclude that it applied to the “right to transport goods to market without restriction.” The court also held that the fuel importation laws were not purely regulatory, since the purpose of the licensing requirement is to collect taxes.

A dissenting judge concluded that the treaty does not preclude taxation in this case because the state laws burden trade, “the wholesale possession of fuel within Washington,” not fuel transport.

The implications of this case may extend well beyond Washington State. The Washington Supreme Court noted that the “right to travel” provision is unique to the Yakama and Nez Perce tribal treaties. The State of Idaho’s certiorari stage amicus brief states that tribes with this language in their treaties are located in Washington, Idaho, and Montana. The states also point out that the Ninth Circuit interpretation of this treaty language is potentially very broad. “The right-to-travel provision in the three treaties applies to ‘all public highways.’ Literally read, the provision’s geographical reach extends throughout the United States. Even a more limited construction – e.g., the Yakama Nation’s pre-treaty trade, usufructuary and social travel area – would encompass a huge territory.”