Two New York Indian nations will return to federal court in their challenge of the state's plans to begin taxing reservation cigarette sales to non-Indian customers.
U.S. District Judge Richard Arcara granted a temporary restraining order last week barring the state from enforcing the $4.35 per pack tax against the Seneca and Cayuga nations of western New York.
A separate order by a state judge temporarily barred the levy for all the tribes in the cigarette business.
On Tuesday, lawyers in the federal case will return for a procedural conference.
Cash-strapped New York state believes it will raise $200 million a year by requiring cigarette wholesalers to pay the sales taxes before supplying reservation stores. Reservation retailers see it as an attack on tribal sovereignty.
