Are sales to mixed-blood descendants of the Ute Tribe who are not themselves enrolled tribal members exempt from Utah sales tax the way sales to enrolled tribal members are?

Plain-English summary

A store owner operating on or near the Uintah and Ouray Reservation wrote to the Utah State Tax Commission in 1991 asking for clarification on a recurring problem: many customers claiming to be "mixed-blood" descendants of the Ute Tribe — some holding cards issued by the Bureau of Indian Affairs office in Fort Duchesne, and others holding cards issued by a group called the "Affiliated Ute Citizens of Utah" — were asserting they were exempt from Utah sales tax. The store owner enclosed a letter that was being circulated on the reservation telling merchants not to collect tax from these customers, and asked the Commission to clear up whether the roughly 490 mixed-blood individuals connected to the tribe were tax-exempt.

The Commission's July 1992 response (through the Auditing Division) held the line drawn in its earlier Tax Bulletin 11-87: sales to tribal members made on the tribe's reservation are not subject to sales tax, and a qualifying sale must be documented with the customer's name, the sale date, the sale amount, and the customer's Federal Bureau (BIA) enrollment number. But the exemption belongs only to enrolled members of the tribe who live within the reservation's exterior boundaries. Anyone who is not an enrolled tribal member living on the reservation — including members of other tribes, mixed-blood individuals who live on or visit the reservation, or relatives of enrolled members who don't themselves qualify for a tribal card — must pay sales tax on the same basis as any other non-tribal customer. The Commission separately confirmed (in an earlier related exchange attached to the file) that it had made no determination extending the exemption based on full-blood or mixed-blood status alone; enrollment and a BIA-issued roll/card number are what count.

What this means for you

Retailers on or near a reservation

Don't extend the sales tax exemption based on a customer's assertion of tribal descent or membership in a group not recognized as the tribe itself. The safe practice under this ruling is to require the customer's Federal Bureau (BIA) enrollment/roll number and to document the sale (name, date, amount, and that number) before treating it as exempt. A card issued by an organization other than the tribe or the BIA is not, by itself, proof of the exemption.

Individuals asserting tribal-descent tax exemption

This ruling is a reminder that Utah's on-reservation sales tax exemption turns on formal enrolled membership in the tribe (evidenced by a BIA enrollment number) and residence within the reservation's exterior boundaries — not on ancestry, "mixed-blood" status, or membership in an affiliated citizens' group that is not the tribe's own enrollment roll.

Common questions

Q: Does being a descendant of tribal members make a purchase tax-exempt?
A: Not by itself. The Commission requires actual enrolled membership in the tribe, evidenced by a Federal Bureau (BIA) enrollment/roll number, plus residence on the reservation.

Q: What documentation should a merchant collect to support an exempt on-reservation sale?
A: Per Tax Bulletin 11-87 as described in this ruling: the customer's name, the date of sale, the amount of sale, and the customer's Federal Bureau (BIA) enrollment number.

Q: Is a card from a group other than the tribe or the BIA sufficient proof of exemption?
A: This ruling suggests no — the Commission's answer focused on enrolled tribal membership and a BIA roll number, not cards issued by other organizations.

Citations and references

Guidance referenced:

• Tax Bulletin 11-87 — states that sales to tribal members made on the tribe's reservation are not subject to Utah sales tax, subject to the enrollment and documentation requirements described above

Source

• Landing page: https://tax.utah.gov/commission/rulings/
• Original page: https://files.tax.utah.gov/tax/commission/ruling/92-034.htm

Original ruling text

Response
July 20, 1992

July
20, 1992

XXXXX

Re:
Sales to the Affiliated XXXXX Citizens

This
letter is in response to your recent request for a Tax Commission ruling on
whether sales tax is due on sales to mixed-blood members of the Affiliated Ute
Citizens.

The
Tax Commission policy is to refer such requests to the division most qualified
to analyze the request and make recommendations concerning it. As such, your
request was referred to the Tax Commission's Auditing Division for their
analysis and recommendations. The division's recommendations are as follows:

1.
Tax Bulletin 11-87 states that sales to tribal members made on the tribe's reservation
are not subject to sales tax. A sale on the Ute Indian Reservation to a Ute
Indian should be evidenced by completion of a list of on-reservation sales
containing the Indian customer's name, the date of sale, the amount of the sale
and the Federal Bureau number of the tribal member.

2.
Anyone who is not an enrolled member of the tribe living on the reservation is
not entitled to any tax exemption even though he or she may claim membership in
another tribe or some relationship to an enrolled member of the tribe. For
example, members of other tribes, mixed-blood Indians who live on or visit the
reservation (such as Affiliated Ute citizens), or relatives of tribal members
who do not themselves qualify for a tribal card must pay taxes on the same basis
as any other non-tribal member living on the reservation.

For
the Commission,

Joe
B Pacheco,

Commissioner

Dear
Tax Commission:

I'm
writing in regards to the status of the Original 490 Ute mixed-blood Utes
residing on the XXXXX and XXXXX Reservation.

As
a store owner I've had many claiming to be tax exempt along with those on the
Ute Tribe Roll. They do have
cards. Some are issued by the Bureau of
Indian Affairs Fort Dushesne Utah. And
some are issued by a group called the Affiliated Ute Citizens of Utah.

I'm
enclosing a copy of a letter being circulated throughout the Reservation to
store owners.

Will
you please clear this matter up. The
Tax Bulletin from March 1987 is not clear, only mentions a card and roll
number.

Are
the 490 mixed-blood's exempt from State tax as long as they have a card or
what?

Thank
You

XXXXX

XXXXX,
President

Dear
XXXXX:

In
March 1987, the Tax Commission issued a bulletin concerning non-taxable sales
to tribal members. This bulletin (copy
attached) stated that enrolled members of a tribe, who live within the exterior
limits of the reservation, are not subject to Utah sales or use tax.

The
Tax Commission did not make any determination for full-blood or mixed-blood
members. They do require, however, that
the member give their Federal Bureau Number as evidenced by their tribal card.

XXXXX,
XXXXX, State Tax Commission, can be contacted if you have further questions.

Sincerely,

XXXXX

Governor