74 Op. Att'y Gen. 134 (1985)

74 Op. Att'y Gen. 134, 139 (1985)
  4.   On whom does the burden of the tax ultimately fall? See Moe, Colville, White Mountain and Ramah Navajo.

74 Op. Att'y Gen. 134, 139 (1985)
  5.   Is the state's tax justified by any regulatory function or service? See Ramah Navajo and Mescalero Apache II; cf. Rice v. Rehner, 463 U.S. 713, 724 103 S. Ct. 3291, 3298 (1983).

74 Op. Att'y Gen. 134, 139-140 (1985)
  In the case of taxation of bingo admissions, application of each of the five factors identified above would appear to favor imposition of the chapter 77 use tax on non-Indians. There is no pervasive scheme of federal regulation, nor does it appear that the tribe's ability to comply with federal policies would be adversely affected by imposition of the tax. As discussed, the burden of the tax falls on the non-Indian consumer. Wisconsin has a strong interest in the regulation of bingo, at least with regard to non-Indians. Wis. Const. art. IV, sec. 24 and chs. 163 and 945, Stats. See also Oneida Tribe of Indians of Wis. v. State of Wis., 518 F. Supp. 712 (W.D. Wis. 1981). Particularly reminiscent of Colville is the fact that in promoting their high stakes bingo operations, the various tribes are clearly marketing their exemption from Wisconsin's stringent regulation of bingo-related activities. Cf., Id. 447 U.S. at 155, 157.

74 Op. Att'y Gen. 134, 140 (1985)
  In answer to your fourth question, therefore, the state arguably has authority to impose the chapter 77 use tax on non-Indians purchasing admission to bingo events on Indian reservations. As already discussed, section 77.53 requires precollection of the tax by Indian retailers. With regard to reservation sales of other types of services, the answer would depend on the application of the five factors listed above to the facts of the particular case.

74 Op. Att'y Gen. 134, 140 (1985)
  Assuming that a delinquent tax liability can be assessed against Indian retailers for failure to precollect the chapter 77 use tax, you ask the following questions about enforcement:

74 Op. Att'y Gen. 134, 140 (1985)
5. In the event of a delinquent tax liability, to what extent may the department pursue collection efforts against Indian retailers, particularly in regard to:

74 Op. Att'y Gen. 134, 140 (1985)
a. Garnishing bank accounts of Indian tribes?

74 Op. Att'y Gen. 134, 140 (1985)
b. Seizing cigarettes?

74 Op. Att'y Gen. 134, 140 (1985)
c. Off-setting refunds of cigarette excise taxes?

74 Op. Att'y Gen. 134, 140 (1985)
6. If not currently authorized, may any of the foregoing collection procedures be authorized by enabling legislation at the state level without violating the federal constitution or laws?

74 Op. Att'y Gen. 134, 140-141 (1985)
  Indian tribes possess the common law immunity from suit enjoyed by sovereign powers and are exempt from suit absent congressional authorization. United States v. United States Fidelity and Guaranty Co., 309 U.S. 506, 512-13 (1940), quoted in Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58 (1978). Aspects of tribal sovereign immunity create, in varying degrees, difficulties with each of the enforcement mechanisms you suggest if the Indian retailer is an Indian tribe or a tribal corporation. Tribal sovereign immunity does not immunize individual Indians or Indian partnerships from suit. Puyallup Tribe v. Washington Game Dept., 433 U.S. 165, 171-72 (1977). Although the difficulties in securing personal jurisdiction over an individual Indian retailer in state court actions such as garnishment may be significant, cf., Sanapaw v. Smith, 113 Wis. 2d 232, 335 N.W.2d 425 (Ct. App. 1983), criticized, County of Vilas v. Chapman, 122 Wis. 2d 211, 361 N.W.2d 699 (1985), this discussion is limited to enforcement efforts against a tribe itself or against a tribal corporation.

74 Op. Att'y Gen. 134, 141 (1985)
  Garnishment is the only one of the enforcement methods you mention which requires an action in state court. Garnishment in Wisconsin is a statutory procedure requiring service of process upon both the garnishee and the defendant (in this case, the tribe or tribal corporation). Sec. 812.04(3) and 812.07, Stats. Commencement of a garnishment action by proper service of process brings the funds held by the garnishee under the jurisdiction of the court. Elliott v. Regan, 274 Wis. 298, 303, 79 N.W.2d 657 (1956); Winner v. Hoyt, 68 Wis. 278, 289, 32 N.W. 128 (1887).

74 Op. Att'y Gen. 134, 141 (1985)
  The requirements for service upon a garnishee defendant are not only statutory, chapter 812, but have a constitutional basis as well. See generally Snaidach v. Family Finance Corp., 395 U.S. 337 (1969); Fuentes v. Shevin, 407 U.S. 67 (1972); North Georgia Finishing v. Di-Chem, 419 U.S. 601 (1975).

74 Op. Att'y Gen. 134, 141 (1985)
  An action for garnishment of a tribal bank account collides directly with the problem of tribal sovereign immunity. United States Fidelity & Guaranty Co., 309 U.S. at 512-13; Puyallup, 433 U.S. at 172-3. Where tribal sovereign immunity has not been waived, Indian tribes are immune from garnishment actions as either garnishee or defendant. North Sea Products, Ltd. v. Clipper Seafoods, 92 Wash. 2d 236, 595 P.2d 938 (Wash. 1979); Maryland Casualty Co. v. Citizens National Bank of West Hollywood, 361 F.2d 517, 521-22 (5th Cir. 1966). These cases illustrate the general rule that a proceeding against property in which the sovereign has an interest is a suit against the sovereign for which a waiver of immunity is necessary. See Maricopa County v. Valley National Bank, 318 U.S. 357 (1943).

74 Op. Att'y Gen. 134, 141-142 (1985)
  A waiver of sovereign immunity by Congress cannot be implied, but must be unequivocal. Santa Clara Pueblo, 436 U.S. at 58. Indeed, Santa Clara Pueblo strongly suggests that only Congress and not the tribe itself can abrogate tribal sovereign immunity. Id., 436 U.S. at 58-59. Furthermore, general statutes such as the Indian Civil Rights Act, 25 U.S.C. 1301, et seq., or Pub. L. No. 280 (28 U.S.C. 1360(a)), the statute providing for state civil jurisdiction in actions to which Indians are parties, do not waive general tribal immunity from suit. Id., 436 U.S. at 59; Atkinson v. Haldane, 569 P.2d 151, 167 (Alaska 1977).

74 Op. Att'y Gen. 134, 142 (1985)
  For tribes organized under the Indian Reorganization Act, 25 U.S.C. 461 et seq., two formal types of tribal organizations are possible: governmental corporations organized under section 16 of the act, 25 U.S.C. 476, and business corporations organized under section 17 of the act, 25 U.S.C. 477. Atkinson, 569 P.2d at 170-75; S. Unique v. Gila River Pima-Maricopa, 674 P.2d 1376, 1379-82 (Ariz. App. 1983).

74 Op. Att'y Gen. 134, 142 (1985)
  Courts have uniformly held that section 16 corporations, i.e. tribal governmental units, enjoy full sovereign immunity. See, e.g., Atkinson, 569 P.2d at 174-75; Boe v. Fort Belknap Indian Community, Inc., 455 F. Supp. 462 (D. Mont. 1978); Parker Drilling Co. v. Metlakatla Indian Community, 451 F. Supp. 1127, 1131 (D. Alaska 1978).

74 Op. Att'y Gen. 134, 142 (1985)
  Section 17 business corporations, on the other hand, clearly have the ability to waive sovereign immunity, although the mere fact of corporate activity or the mere existence of a corporate charter does not waive tribal immunity for governmental conduct. Parker Drilling, 451 F. Supp. at 1136; Gold v. Confederated Tribes of the Warm Springs, 478 F. Supp. 190, 196 (D. Ore. 1979), and cases cited therein; but see Martinez v. Southern Ute Tribe, 150 Colo. 504, 374 P.2d 691, 694 (1962). However, a "sue and be sued" clause in the corporate charter will constitute a waiver of sovereign immunity. See, e.g., Parker Drilling, 451 F. Supp. at 1136; Kenai Oil and Gas, Inc. v. Dept. of Interior, 522 F. Supp. 521 (D. Utah 1981). The scope of waiver is limited by the precise terms of the corporate charter, however, and a tribal business organization may restrict the extent of the waiver to limit its liability. Parker Drilling, 451 F. Supp. at 1137. A common exclusion from waiver, from "the levy of any judgment, lien or attachment upon [tribal] property other than income or chattels especially pledged," preserves tribal sovereign immunity in garnishment actions. Maryland Casualty, 361 F.2d at 521; cf. Namekagon Development Co. v. Bois Forte Reservation Housing Authority, 517 F.2d 508 (8th Cir. 1975).

74 Op. Att'y Gen. 134, 142-143 (1985)
  In summary, bank accounts of a tribal governmental corporation enjoy sovereign immunity from state court garnishment actions. Bank accounts of a tribal business corporation may also be immune from garnishment, unless a sue and be sued clause in the corporate charter waives sovereign immunity. Even then, scope of the waiver may preclude the availability of garnishment as a remedy for collection of outstanding tax liability in a garnishment action.

74 Op. Att'y Gen. 134, 143 (1985)
  With regard to garnishment actions, the limitations on the state's ability to garnish assets of an Indian tribe or tribal business corporation based on tribal sovereign immunity is a matter of federal law. Because only Congress and to a limited extent the tribe itself can waive tribal immunity from suit, state legislation authorizing garnishment of tribal assets would have no effect.

74 Op. Att'y Gen. 134, 143 (1985)
  You inquire next about the department's authority to seize cigarettes, presumably shipments destined for sale on the reservation prior to the actual retail sale. As you are undoubtedly aware, off-reservation seizures of cigarettes destined for delivery to Indian retailers on their reservation have been approved by the courts if authorized by statute and warranted by surrounding circumstances. Colville, 447 U.S. at 161-62; Stagner v. Wyoming State Tax Commission, 682 P.2d 326 (Wyo.) appeal dismissed, 105 S. Ct. 237 (1984). Circumstances which justify seizure are suggested in Colville where the Court noted that the tribes involved had consistently refused to fulfill validly imposed collection and remittance obligations and pointedly emphasized that the seizures had in fact taken place off the reservation. Colville, 447 U.S. at 161-62. Stagner suggests that the lack of alternative enforcement options is also a circumstance which would justify seizure as an enforcement mechanism for collection of an otherwise valid tax. Stagner 682 P.2d at 331-32.

74 Op. Att'y Gen. 134, 143 (1985)
  After Colville, on-reservation seizures are not likely to be approved by the courts, particularly when an off-reservation seizure is an available option. At best, the legality of on-reservation seizures is technically unsettled. The assertion by the state of authority to make on-reservation seizures would invite litigation which the state is likely to lose, given the implicit suggestion in Colville that such seizures would "unnecessarily intrud[e] on core tribal interests." Id., 447 U.S. at 162.

74 Op. Att'y Gen. 134, 143-144 (1985)
  Unlike under the cigarette tax statute itself, chapter 139, subchapter II, there appears to be no clear statutory authority for the department to seize shipments of cigarettes en route to Indian retailers who have refused to comply with the collection and remittance obligations of section 77.53. Cf. sec. 139.40, Stats. Nonetheless, in view of Colville and Stagner, clearly delineated statutory authority to seize goods when there is a documented pattern of refusal to comply with validly imposed state tax obligations would not violate federal law, as long as the seizures occurred outside a tribal reservation. Of course, as with garnishment, if on-reservation seizures are preempted as a matter of federal law, the acquisition of additional statutory authority under state law would be ineffective.

74 Op. Att'y Gen. 134, 144 (1985)
  Finally, you ask about the department's authority to offset refunds to Indian tribes of cigarette taxes under chapter 139, subchapter II, particularly section 139.323, Stats. (1983), against a use tax liability assessed under chapter 77, subchapter III. I am not aware of any basis in federal law to suggest that such a procedure would be illegal as long as the taxes involved are valid and basic constitutional requirements, including the right to due process, are met. Cf. Moe, 425 U.S. at 483; Colville, 447 U.S. at 161-62.

74 Op. Att'y Gen. 134, 144 (1985)
  I am, however, of the opinion that such an offset is not currently authorized by statute and that it may be difficult, for a variety of reasons, for the department to secure the additional authority to offset tribal refunds under section 139.323 against an outstanding use tax liability under the general sales tax statute. My opinion, in this regard, is based both on the unambiguous language of section 139.323 itself and on the legislative history of the 1983 amendments to the cigarette tax statute contained in 1983 Wisconsin Act 27.

74 Op. Att'y Gen. 134, 144 (1985)
  Following my 1979 opinion, the department interpreted chapter 139, subchapter II, as containing an implied exemption from the state's cigarette tax law for Indian persons or tribes buying or selling cigarettes on their reservations. See section TAX 9.08 Wis. Adm. Code (1981). The 1979 opinion also highlighted the fact, however, that under the existing statute, the department had no effective means of collecting the alternative use tax lawfully imposed by section 139.33 on non-Indian purchasers when the sales occurred on Indian reservations or on Indian trust lands. This loophole in the cigarette tax law resulted in significant annual revenue losses from reservation cigarette sales to non-Indians in the years following 1979. (See Veto Message on 1981 S.B. 783, Budget Adjustment Bill, April 29, 1982, p. 4).

74 Op. Att'y Gen. 134, 144-145 (1985)
  In 1982, then Governor Dreyfus vetoed statutory amendments to chapter 139 patterned directly on the Washington statute approved in Colville, largely because of vigorous tribal opposition to the amendments. In doing so, the Governor urged that legislation be developed which would accommodate both state and tribal interests. Id.

74 Op. Att'y Gen. 134, 145 (1985)
  Following the Governor's veto of the 1981 amendments to chapter 139, state and tribal representatives developed a mutually acceptable proposal which was substantially incorporated into Governor Earl's 1983 Budget Bill (See LRB bill folder for 1983 S.B. 83, secs. 1496-1507). The amendments to chapter 139, subchapter II, were modified in minor respects during consideration by the Joint Finance Committee and were subsequently enacted without further change. See Sen. Sub. Amend. 1 to 1983 S.B. 83, secs. 1502m and 1506m; and 1983 Wisconsin Act 27, secs. 1496-1506m.

74 Op. Att'y Gen. 134, 145 (1985)
  The 1983 amendments made two principal changes in chapter 139, subchapter II. First, the tax on cigarettes imposed by section 139.31 was changed from an occupational tax on the seller to an excise tax, the incidence of which falls on the ultimate consumer-purchaser. Sec. 139.31(1), Stats. (1983). Secondly, the department was authorized to enter into voluntary agreements with the various state tribes, the net effect of which is to refund to the tribe seventy percent of all taxes collected under section 139.31(1) in respect to cigarette sales on that tribe's reservation or trust lands as well as all such taxes precollected on sales to tribal members. Secs. 139.323 and 139.325, Stats. (1983).

74 Op. Att'y Gen. 134, 145 (1985)
  Section 139.323 contains no express authority for the department to offset the seventy percent tribal refund authorized thereunder against tax liability assessed under the sales tax statute. The statute is not ambiguous, but even if it were, the legislative history discussed above would not support an argument that such authority could be implied. Instead, the legislative history of the 1983 amendments to chapter 139 strongly suggests that the conditions set forth in section 139.323 for the seventy percent tribal refund were intended to be mandatory, precise and exclusive.

74 Op. Att'y Gen. 134, 145-146 (1985)
  The enactment of the 1983 amendments to the cigarette tax law and their ongoing administration with regard to sales on Indian reservations has been, as you know, dependent to a significant degree on the cooperation of tribal authorities. This is a factor you undoubtedly will wish to consider in deciding whether to seek statutory authority to offset section 139.323 refunds against tax liability assessed under the general sales tax law.

74 Op. Att'y Gen. 134, 146 (1985)
BCL:MAM
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