United South & Eastern Tribes Tax Initiatives & Proposals for Comprehensive Tax Reform National Intertribal Tax Alliance September 16, 2015

USET Tax Reform Principles Align federal tax policy with core federal Indian policy objectives : – tribal self-determination – economic growth and self-sufficiency – strong tribal governments (on equal footing with other sovereigns in the federal system)

USET Tax Reform Principles Promote economic growth and foster tax code fairness Advance the ability of Tribes to build an economic base and create jobs – Encourage private investment in Indian Country – Provide full access to public financing tools Ensure that revenues generated within tribal territories are retained by tribes Respect tribal leader decision-making Promote certainty of jurisdiction

Engagement at Various Levels Capitol Hill: – Tax Reform & Extenders (Senate Finance and House Ways & Means) [Recent USET Comments to Finance Committee Working Groups] Administrative Agencies – Treasury, IRS and Interior Courts: – Monitor cases re State/local government taxes on Indian Lands Tribal government: – Governance and Capacity Building

USET Tax Reform Proposals ORGANIZED AROUND CORE THEMES – Advance Important Federal Policy – Help Grow the Economy – Promote Tax Fairness

USET Tax Reform Proposals Advance Important Federal Policy - Align the tax code with the Indian Self-Determination Policy Tribal General Welfare Exclusion Act (Legislation enacted) – P.L expands Rev Proc , and calls for benefits to be treated at least as favorably as the IRS safe harbors – Incorporates canon of construction – Suspends audits and examinations – Requires training of IRS field agents Tribal Advisory Committee (Legislation enacted) – P.L creates TAC – Scope includes Indian tax matters (broad mandate) – Duties include the development of IRS field agent training program

USET Tax Reform Proposals Help Grow the Economy 1. USET Resolution – Ensure income generated in Indian Country serves tribal communities Identify avenues for legislative clarification/preemption Monitor court cases and structure activities to preempt state/local taxation Promote use of BIA Land Leasing Regulations 2.Tax Immunity for Tribe-to-Tribe Commerce 3.Adopt the Indian Country Economic Revitalization Act (H.R. 4699)

USET Tax Reform Proposals Help Grow the Economy 4. Establish Tribal Empowerment Zones in Indian Country 5.Improve the Effectiveness of the "Tax Extenders" Intended to Benefit Indian Country -Indian Employment Tax Credit/Accelerated Depreciation -New Markets Tax Credit -Clean Renewable Energy Bonds/Coal Production Credit

USET Tax Reform Proposals Promote Tax Fairness 1.Eliminate Special Restrictions on Tribal Government Debt (Sec. 3, HR 3030) 2.Provide Parity in Treatment of Tribal Government Pensions (Sec. 4, HR 3030) 3.Ensure Social Security Eligibility for Tribal Council Members 4.Provide for Equitable Application of the Adoption Tax Credit (HR 2332)

USET Tax Reform Proposals Promote Tax Fairness 5.Equip tribal child support enforcement agencies with the tools states may use (Sec. 6, HR 3030) 6.Promote Parity in the Health Care Professionals Loan Repayment Exclusion (HR 3391) 7.Eliminate burdens in Medicaid Electronic Health Record (EHR) Incentive Payments Assigned to Tribal Health Care Facilities 8.Exempt Tribal Government Distributions from the Kiddie Tax

Federal Agency Policy and Implementation Issues Treasury/IRS – GWE Implementation Notice (comments due 10/14/15) – Tribal Advisory Committee – Treasury Interim Consultation Policy Interior – Leasing Regulations/Preemption of state taxation – Restricted Settlement Acts and jurisdiction issues