Argument of Chief Justice Rehnquist
Mr. Rehnquist: The second opinion of the Court I have to announce is No. 00-454, Atkinson Trading Company against Shirley.
The Navajo Indian Tribe imposes an 8% tax upon all hotel rooms located within the exterior boundaries of its reservation.
The Atkinson Trading Company operates such a hotel near Cameron, Arizona, just south of the Little Colorado River on the road from Flagstaff up to the Grand Canyon.
The trading company is not a member of the Navajo Nation and owns the land itself.
It argues that the Navajo Tribe lacks the authority to enforce this hotel tax against non-members residing on non-Indian land.
The Court of Appeals for the Tenth Circuit rejected this argument.
In an opinion filed with a Clerk of the Court today, we reverse.
Our cases in this area have established that with limited exceptions Indian Tribes lack civil authority over non-members on non-Indian land within a reservation.
We hold that this general rule applies to revenue raising taxes imposed by tribes.
Although, we have upheld an Indian tribes ability to tax non members extracting oil and gas from tribal land.
Indian Tribes have never been allowed to tax non members conducting business on their own land.
This is because the Indian Tribes are dependent sovereigns and therefore, have only limited civil authority.
The Navajo Indian Tribe however, says that the exceptions to this general rule apply here; an Indian Tribe may assert civil jurisdiction over a non-Indian land where the non-members entered into a consensual relationship with the Tribe or whether non-members conduct threatens the political integrity of the Tribe, but we think that neither exception obtains here.
First although the Trading Post has a license to conduct business with Navajo Indians, this relationship cannot support the hotel tax, which is imposed upon the Trading Post’s non member guests who reach the hotel on public roads, and while the Trading Post benefits from the availability of tribal police, fire and emergency services, this is not sufficient to trigger the Navajo Nation’s civil authority otherwise the exception would simply swallow the rule.
Second the Trading Post operation of a hotel on its own land cannot be said to imperil the political integrity of the Navajo Nation.
Because the exceptions do not apply the rule of the Indian Tribes lacks civil authority over non-members on non-Indian land controls this case, the hotel tax is invalid.
Justice Souter has filed a concurring opinion in which Justice Kennedy and Thomas joined.
