Tribal Advantage 101: Leveraging a Tribes Advantage on Bulk Fuel

Tribal Advantage 101: Leveraging a Tribes Advantage on Bulk Fuel
If a tribe has not partnered with a wholesale fuel company (like Desert Fuels) that knows how tribes can leverage fuel tax advantages, they can be literally missing out on millions of dollars.

Native Americans, American Indians, and Indigenous people. What is all the fuss with all things Tribal in the United States? What does a wholesale fuel company (and good one I might add) know about or have anything to do with Native American affairs? Good question… I thought you would never ask.

Native American tribes are governed federally. They are viewed as their own sovereign nation that is outside the jurisdiction of state laws. This means they are only required to adhere to federal laws and not state laws. (Wait for it – the connection to fuel is coming) The largest implication or tribal advantage comes in the form of state taxes that they are exempt from.

Native American Tribes and Bulk Fuel:

The Native American Advantage: Most states charge a state fuel excise tax (on top of the federal $0.184 per gallon on gas) of $0.15 to $0.40 per gallon. This does not apply to tribes. Each state varies in how they interpret when the state fuel excise tax is due, some saying as long as the fuel is sold on tribal land then no tax is due, others say the tax is only exempt if sold to a Native American individual that is registered with a Tribe, while others claim that if the fuel hits a state road that the tax becomes due at that time.

The Challenge: The challenge arises in how to navigate the state laws in such a way that the Tribe can institute their own fuel tax and generate tax revenue for the Tribe instead of the state.

Tribal Expertise: Desert Fuels has worked with more than 20 Tribes across 7 different states, helping them leverage any and all tax advantages available to them. A typical gas station makes, on average, 5-10 cents per gallon by selling fuel at retail. If this number can be increased by $0.20 due to a tax advantage or if the volume can be significantly increased by using this tax advantage to be more aggressive on their street price, the profits generated can easily be in the millions of dollars a year.

States have negotiated many different compacts with Tribes across the nation. These are contracts between the State and the Tribe in which they agree upon how certain tax issues will be handled amongst them, since neither has the obligation to work with one another.

If a tribe has not partnered with a wholesale fuel company (like Desert Fuels) that knows how tribes can leverage fuel tax advantages, they can be literally missing out on millions of dollars.

Other Tribal Advantages

Fuel is not the only profit center where tax advantage exists for tribes. Tobacco, sales tax, casino gambling or any other item that is heavily taxed and or regulated by the state is another area where substantial tax savings = large profits for Tribes. The true win for a Tribe comes when they can leverage multiple of these advantages in a synergistic relationship. For example, using the casino point redemption as a means to cross-promote fuel sales in which a tax advantage exists.

Next Steps:

Jay Kennedy is our resident expert on bulk fuel and  tribal advantages. Contact Jay for more information and how we can help you.

Jay Kennedy
505-369-3509
[email protected]

List of Federally Recognized Tribes within Desert Fuels’ Footprint:

Arizona:

  • Ak Chin Indian Community of the Maricopa (Ak Chin) Indian Reservation, Arizona
  • Cocopah Tribe of Arizona
  • Fort McDowell Yavapai Nation, Arizona
  • (formerly the Fort McDowell Mohave-Apache Community of the Fort McDowell Indian Reservation)
  • Gila River Indian Community of the Gila River Indian Reservation, Arizona
  • Havasupai Tribe of the Havasupai Reservation, Arizona
  • Hopi Tribe of Arizona
  • Hualapai Indian Tribe of the Hualapai Indian Reservation, Arizona
  • Kaibab Band of Paiute Indians of the Kaibab Indian Reservation, Arizona
  • Pascua Yaqui Tribe of Arizona
  • Salt River Pima-Maricopa Indian Community of the Salt River Reservation, Arizona
  • San Carlos Apache Tribe of the San Carlos Reservation, Arizona
  • San Juan Southern Paiute Tribe of Arizona
  • Tohono O’odham Nation of Arizona
  • (formerly Papago Indian Tribe)
  • Tonto Apache Tribe of Arizona
  • White Mountain Apache Tribe of the Fort Apache Reservation, Arizona
  • Yavapai-Apache Nation of the Camp Verde Indian Reservation, Arizona
  • Yavapai-Prescott Tribe of the Yavapai Reservation, Arizona

Colorado:

  • Southern Ute Indian Tribe of the Southern Ute Reservation, Colorado

Tribes In Several States:

  • Colorado River Indian Tribes of the Colorado River Indian Reservation, Arizona and California
  • Fort Mojave Indian Tribe of Arizona, California & Nevada
  • Navajo Nation, Arizona, New Mexico & Utah
  • Quechan Tribe of the Fort Yuma Indian Reservation, California & Arizona
  • Ute Mountain Tribe of the Ute Mountain Reservation, Colorado, New Mexico & Utah
  • Fort Sill Apache Tribe

New Mexico:

  • Jicarilla Apache Nation, New Mexico
  • (formerly the Jicarilla Apache Tribe of the Jicarilla Apache Indian Reservation)
  • Mescalero Apache Tribe of the Mescalero Reservation, New Mexico
  • Ohkay Owingeh, New Mexico (formerly the Pueblo of San Juan)
  • Pueblo of Acoma, New Mexico
  • Pueblo of Cochiti, New Mexico
  • Pueblo of Jemez, New Mexico
  • Pueblo of Isleta, New Mexico
  • Pueblo of Laguna, New Mexico
  • Pueblo of Nambe, New Mexico
  • Pueblo of Picuris, New Mexico
  • Pueblo of Pojoaque, New Mexico
  • Pueblo of San Felipe, New Mexico
  • Pueblo of San Ildefonso, New Mexico
  • Pueblo of Sandia, New Mexico
  • Pueblo of Santa Ana, New Mexico
  • Pueblo of Santa Clara, New Mexico
  • Pueblo of Santo Domingo, New Mexico
  • Pueblo of Taos, New Mexico
  • Pueblo of Tesuque, New Mexico
  • Pueblo of Zia, New Mexico
  • Zuni Tribe of the Zuni Reservation, New Mexico

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