Tax Commission Decides To Delay Enforcement Of New Tobacco Tax Rule

Tuesday, May 2nd 2006, 5:54 am

By: News On 6

TULSA, Okla. (AP) The Oklahoma Tax Commission decides today to delay enforcement of a new cigarette tax rule for at least 30 days while the state and some American Indian tribes negotiate.

The state adopted a rule requiring tribes to pay 86 cents per pack in taxes upfront as part of an effort to curb the sale of cigarettes with only six-cent tax stamps by unauthorized stores.

Tribes that have reached agreements with the state are supposed to charge 86 cents in tax unless they are close to the border, where the six-cent rate is allowed.

But some tribally licensed smoke shops in northeastern Oklahoma have been reselling their cigarettes with lower-tax stamps to other American Indian smoke shops in the Tulsa area.

Commissioner Jerry Johnson said if a settlement is reached, the rule would be dropped.

Osage Nation leaders say the state is trying to keep the issue out of federal court by suspending the rule.

Tribal attorney Gary Pitchlynn said the federal court could force Oklahoma Governor Brad Henry to enter into arbitration with the Indians rather than enforce the new rule.