The Department of Revenue (DOR) is the State of Washington’s primary tax agency; DOR’s vision is to establish “An open and collaborative environment that maximizes service delivery and achieves the highest levels of voluntary compliance.” This requires a commitment to work with all sectors of the public, including tribes, tribal citizens and entities that do business in Indian Country. The Centennial Accord’s principles present a written establishment of the government-to-government relationship and codify DOR’s commitment to work with tribes.
DOR pledges to work on a day-to-day basis to foster the government-to-government relationship with each tribe. The complex jurisdictional framework regarding Indian country and the inherent sovereignty of each tribe require a commitment to a genuine working relationship with tribes. In this vein, the Department’s full-time Tribal Liaison works with DOR’s executive team and a talented tribal team from across the agency to develop and implement its tribal strategic plan, which includes resolving tribal related issues, proactively developing educational outreach materials for the public, and providing training as requested. It is in this spirit that DOR presents its 2011 Centennial Accord highlights.
Current Department Priorities
The Department’s priorities are laid out below. While the Department is committed to hearing from tribes on its priorities, we recognize that the state does not have jurisdiction to regulate tribes as a general matter. These competing concerns must be balanced when determining whether to include tribes in the development of DOR’s rules and policies. DOR continues to develop a list of tribal contacts that it can notify regarding rule and policy development. DOR sincerely welcomes the tribe’s thoughts on any of the following priorities:
- tax simplification
- transfer of the Master Licensing System to Revenue
- modernizing our tax system
- data migration
- service delivery including facilities
- implementation of 2011 tax legislation
- reducing the underground economy, and
improving our communication with taxpayers.
Tribal Constituent Services
Part of DOR’s open and collaborative effort is centered on the Department being available to respond to questions or issues that have tribal components. These questions come to the tribal team by phone, email, fax, letter, or via the website. Shana Barehand, DOR’s Tribal Liaison, coordinates all responses to ensure consistency and is a central point of contact for all tribal related questions.
Again this year the tribal team has responded to over 200 tribal related inquiries. Most questions involved sales and use tax in Indian country and the treaty fishing exemption. The majority of the tribal team’s time is spent responding to inquiries and requests. However, with efficient use of DOR resources, the tribal team also works to develop appropriate informational material, conduct appropriate targeted outreach, and make team members available to speak at appropriate events. Below is more detail regarding some of the work done by the DOR tribal team.
Education and Outreach
One of the tribal program’s objectives is to make sure all taxpayers understand their tax liability and comply with their reporting responsibilities when interacting with tribes and their citizens. These efforts include making retailers aware of the simple forms that allow for documentation of tax exempt purchases. These forms are not used to track tribal purchases, but to protect the retailer in the event of an audit. These forms can be found on the DOR website or requested from Shana Barehand.
This year, to simplify treaty fishing purchases, we have modified the forms so that only one form per person per retailer need be filed, rather than requiring the filing of a new form each time a purchase is made. Several forms are available on DOR’s website to assist tribes, tribal citizens, and tax payers in documenting the exemption. We will continue our efforts to assist tribal citizens and taxpayers in complying with the law.
Finally, DOR is the only state to have a tax guide regarding Indian tribes that helps people understand the law in Washington State.It can be found here.
Property Tax Exemption Administration
The 2004 Legislature amended property tax statutes to exempt property owned in "fee" by federally recognized tribes if that property is used for essential government services. The DOR has a dedicated staff member, Sindy Armstrong, within the Property Tax Division to work on these determinations and she recently presented at the 20th Annual Indian Land Consolidation Symposium.
- Records indicate 2,382 tribally owned parcels are currently exempt under RCW 84.36.010-Essential Government Services. This number fluctuates as tribes acquire and use properties or move property into Trust status.
- To assist in managing the exemption, DOR provides both the tribes and assessors an annual listing of tribal property exempt under RCW 84.36.010, stating the essential government service for which the property is used.
Cigarette Compacts & Their Administration
In 2001 the Legislature provided authority to the Governor to enter into compacts with tribes regarding cigarette taxation, these compacts eliminate the disputes regarding cigarette taxes on the reservation. Today there are twenty-three cigarette compacts in place. Two were executed this year.
Shana Greenberg Barehand, 360-534- 1573 or ShanaB@dor.wa.gov