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OCTOBER TERM, 2005

95

Syllabus

WAGNON, SECRETARY, KANSAS DEPARTMENT

OF REVENUE v. PRAIRIE BAND

POTAWATOMI NATION

certiorari to the united states court of appeals for the tenth circuit No. 04–631. Argued October 3, 2005—Decided December 6, 2005 Kansas’ motor fuel tax applies to the receipt of fuel by off-reservation non-Indian distributors who subsequently deliver it to the gas station owned by, and located on the Reservation of, the Prairie Band Po­ tawatomi Nation (Nation). The station is meant to accommodate reser­ vation trafﬁc, including patrons driving to the casino the Nation owns and operates there. Most of the station’s fuel is sold to such patrons, but some sales are made to persons living or working on the reservation. The Nation’s own tax on the station’s fuel sales generates revenue for reservation infrastructure. The Nation sued for declaratory judgment and injunctive relief from the State’s collection of its tax from distribu­ tors delivering fuel to the reservation. Granting the State summary judgment, the District Court determined that the balance of state, fed­ eral, and tribal interests tilted in favor of the State under the test set forth in White Mountain Apache Tribe v. Bracker, 448 U. S. 136. The Tenth Circuit reversed, agreeing with the Nation that the Kansas tax is an impermissible affront to its sovereignty. The court reasoned that the Nation’s fuel revenues were derived from value generated primarily on its reservation—i. e., the creation of a new fuel market by virtue of the casino—and that the Nation’s interests in taxing this reservation­ created value to raise revenue for reservation infrastructure out­ weighed the State’s general interest in raising revenues. Held: Because Kansas’ motor fuel tax is a nondiscriminatory tax imposed on an off-reservation transaction between non-Indians, the tax is valid and poses no affront to the Nation’s sovereignty. The Bracker interest-balancing test does not apply to a tax that results from an off­ reservation transaction between non-Indians. Pp. 101–115. 1. The Kansas tax is imposed on non-Indian distributors based upon their off-reservation receipt of motor fuel, not on the on-reservation sale and delivery of that fuel. Pp. 101–110. (a) Under this Court’s Indian tax immunity cases, the “who” and the “where” of a challenged tax have signiﬁcant consequences. “The initial and frequently dispositive question. . . is who bears [a tax’s] legal