Stroble v. OTC

Stroble v. Oklahoma Tax Commission is a current lawsuit before the Oklahoma Supreme Court. Alicia Stroble is a member of the Muscogee (Creek) Nation, who lived and worked within the Muscogee Nation Reservation. Under Supreme Court Precedent and the rules of the Oklahoma Tax Commission, if a person lives and works within their Tribe's Reservation, the State of Oklahoma cannot tax the income that person earns from their employment on the Reservation. Accordingly, Stroble filed a tax protest arguing that because the Muscogee (Creek) Nation Reservation was reaffirmed by the Supreme Court in the McGirt case, she met all the requirements for the tribal tax exemption under the Tax Commission's rules. The Tax Commission denied her protest, arguing that the McGirt ruling didn't apply to taxes. Stroble then appealed to the Oklahoma Supreme Court.

If the Oklahoma Supreme Court rules that the State is free to tax the incomes of Tribal Members who live and work within their Tribe's Reservation, it will be an egregious violation of Tribal Sovereignty. The U.S. Supreme Court has long held that the power to tax involves the power to destroy, and that States are not afforded that power over Tribal Nations. If the State of Oklahoma is allowed to tax Tribal Members in this manner, it could significantly hurt Tribal investment in local communities. When Tribal Members are subjected to State taxes, it makes it extremely difficult for Tribal governments to levy taxes on those individuals and reinvest those tax dollars into essential government services. Those services include infrastructure investments, small business development, and educational investments, all of which are desperately needed in the poorest communities, Native and non-Native alike, within Reservations. Allowing the State to tax these Tribal Members would destroy a path for economic advancement. Additionally, allowing the State to enact these taxes could open the door to further taxation on other protected Tribal activities, which could do further significant harm to the economic development efforts of Tribal Nations across Oklahoma.

The Oklahoma Government claims that it stands to lose vital tax revenue if the Oklahoma Supreme Court doesn't allow taxes on income earned by Tribal Members within their Reservation. However, Oklahoma fails to recognize that Tribes can be capable partners in making up the difference. After all, Tribal Nations are governments capable of providing services even where the State does not provide them. This is a problem that is readily solved by working cooperatively, rather than by trying to undermine Tribal sovereignty.