This Board of Equalization (BOE) publication is intended primarily as a guide to the proper application of California’s Sales and Use Tax Law to transactions occurring in Indian country in California that involve both Indians and non- Indians. It is also intended to help Indian purchasers understand how the Sales and Use Tax Law generally applies to their purchases, as well as to provide some general information on other tax and fee programs administered by the BOE. We use the term “Indian” in this publication since that is the term used in state and federal law for “Ameri- can Indian.”
There are numerous federal and state laws, in addition to opinions issued by the courts, that impact the application of BOE-administered taxes and fees to transactions involving Indians. In administering the Sales and Use Tax Law in a fair and uniform manner, the BOE is subject to, and limited by, all pertinent laws and regulations, including Public Law 83-280, the provisions of the California Revenue and Taxation Code, and opinions issued by the federal courts in Bryan v. Itasca County (1976) 426 U.S. 373, 48 L.Ed.2d 710, Moe v. The Confederated Salish and Kootenai Tribes of the Flathead Reservation (1976) 425 U.S. 463, 48 L.Ed.2d 96, Washington v. Confederated Tribes of the Colville Indian Res- ervation (1980) 447 U.S. 134, 65 L.Ed.2d 10, Oklahoma Tax Commission v. Chickasaw Nation (1995) 515 U.S. 450, 132 L.Ed.2d 400, Cabazon Band of Mission Indians v. Wilson (9th Cir. 1994) 37 F.3d 430, and Oklahoma Tax Commission v. Citizen Band Potawatomi Indian Tribe of Oklahoma (1991) 498 U.S. 505, 112 L.Ed.2d 1112. The BOE is committed to working cooperatively with tribal leaders to respect tribal sovereignty and promote tax compliance in California.
The applicable laws, regulations, and court decisions do not grant the State of California general authority to impose sales and use taxes on Indian tribes in Indian country or on tribal members who live in Indian country. The inherent sovereignty of Indian tribes to exercise powers of self-government over Indian country imposes limitations on the application of state laws to regulate or tax transactions in Indian country. Therefore, certain on-reservation sales to Indians and certain other transactions in Indian country may not be subject to California sales or use tax. While there is no general sales tax exemption for sales to Indians, this publication explains when and how sales or use tax is applicable to transactions with Indians and to transactions that occur in Indian country. This publication also describes the types of documentation that retailers and Indian purchasers need to maintain in order to qualify for an exemption from paying sales or use taxes with respect to certain transactions. It also provides information on certain other applicable California taxes and fees.
Before you read other parts of this publication, be sure to read Key Definitions. It contains important information that will help you as you review the rest of the publication.
This publication supplements our basic sales tax publication 73, Your California Seller’s Permit. Publication 73 includes general information about obtaining a permit, using a resale certificate, reporting and paying sales and use taxes, discontinuing a business, and keeping records.
All BOE publications, forms, regulations, and much more information regarding all of our programs, are available on our website at www.boe.ca.gov.
If you have a general tax question, please call our Taxpayer Information Section and speak with a customer service representative. Customer service representatives are available weekdays from 8:00 a.m. to 5:00 p.m. (Pacific time), except state holidays. Please call 1-800-400-7115, (TTY:711). In addition to English, assistance is available in other languages.
The State of California Franchise Tax Board also offers a printed brochure, publication 674, Frequently Asked Ques- tions About the Income Taxation of Native Americans. The publication is available from their website at www.ftb.ca.gov and by calling their information center, Monday through Friday, from 7:00 a.m. until 6:00 p.m. (Pacific time). Please call 1-800-852-5711 within the United States, or 1-916-845-6500 outside the United States.