First, states can't tax income that a Native American who resides on her tribe's reservation from activities conducted on the reservation. That makes sense. It's another sovereign. There you go.
Second, states can tax income that a Native American who resides outside a reservation receives, even from activities conducted on the reservation. That too makes sense. You're a resident on the lands of the taxing sovereign. That sovereign can tax you. Even for income that you receive from activities in another sovereign. No different than foreign countries. I get it.
Here's the tough part -- and the one at issue in this opinion. What if you're a Native American, and a member of a tribe, but you reside on another tribe's reservation? Can the state tax you on the income you receive from activities conducted on your own reservation?
That's a toughie. And I admittedly didn't know the answer before I read this opinion.
Even after reading the opinion, I'm still not 100% sure I know the correct answer. But (1) I at least now know (for sure) what the law is according to the California Court of Appeal, and (2) Justice McDonald convinces me -- on the merits -- that the right answer may well be "Yes."
So when Angelina Mike gets $365,000 in 2000, which is her share of her tribe's casino profits, California can tax it. That's the law. And Justice McDonald helpfully explains why.
I'm on board with that, I guess. With the simple caveat that it seems strange. In two ways.
First, imagine that we're not talking about an Indian tribe, but a different kind of sovereign; say, a foreign country. The analogy here would be: Can California tax a person who lives in Canada on income that she received from activities in Mexico? The clear answer would be "No". Yet, in the present case, change "Canada" to "The Agua Caliente Band of Cahuilla Indians Reservation" and "Mexico" to "The Twenty-Nine Palms Band of Mission Indians Reservation" and you've got a different result.
That seems weird. Now, I understand that tribes are "domestic" sovereigns, and hence the law somewhat different than "pure" foreign countries. But there' still something there.
Second, on a practical level, what are people like Angelina Mike supposed to do? Indian tribes didn't exactly thrive post-1776, if you know what I mean. In the present case, for example, Mike's tribe contains only twelve people over the age of 18. Plus, it's not like the government selected really great places upon which to place the reservations for Native Americans. Again, here, the reservation for Mike's tribe consists entirely of a 240-acre section near Coachella -- big enough for a casino, a parking lot, and a sanitation place, which is what's on it -- and a 160-acre section near Twenty-Nine Palms. The latter of which is pure, undeveloped desert land, with no electrical, water, or sewer facilities, and has no developed roads or other infrastructure.
What exactly is Mike supposed to do? Live alone, in the middle of the desert, with no electricity, water, or toilets? Or live in the sewage plant? Hardly palatable choices. So she does what any reasonable person would do, especially who cares about tribal membership and native heritage, and lives on the closest Indian reservation -- 18 miles away -- that's technically for a different tribe, but one that "share[s] many historical, familial, social, and genetic ties" with her tribe.
But that means she gets taxed. Even for stuff that occurs entirely on her reservation. So the price to be a truly "sovereign" Native American, at least for people like Mike, is that you've got to either live in sewage or without any sewage at all.
Seems harsh. Maybe that's indeed what the law says. But it's still harsh.