US SUPREME COURT DECISIONS

The 1891 Act that first authorized mineral leasing of Indian lands was amended by a 1924 Act that provided that "the production of oil and gas and other minerals on such lands may be taxed by the State in which said lands are located." The Indian Mineral Leasing Act of 1938, which was enacted to obtain uniformity of Indian mineral leasing laws, also permitted mineral leasing of Indian lands, but contained no provision authorizing state taxation, nor did it repeal specifically such authorization in the 1924 Act. A general repealer clause of the 1938 Act, however, provides that "[a]ll Act[s] or parts of Acts inconsistent herewith are hereby repealed." Respondent Indian Tribe filed suit in Federal District Court challenging the application of several Montana taxes to respondent's royalty interests under oil and gas leases issued to non-Indian lessees pursuant to the 1938 Act, and seeking declaratory and injunctive relief. The District Court granted summary judgment for the State, holding that the taxes were authorized by the 1924 Act, and that the 1938 Act did not repeal this authorization. The Court of Appeals reversed in pertinent part.

Held: Montana may not tax respondent's royalty interests from leases issued pursuant to the 1938 Act. Pp. 471 U. S. 764-768.

(a) Two canons of statutory construction apply to this case: the States may tax Indians only when Congress has manifested clearly its consent to such taxation, and statutes are to be construed liberally in favor of Indians. Pp. 471 U. S. 764-766.

(b) When the 1924 and 1938 Acts are considered in light of these principles, it is clear that the 1924 Act does not authorize Montana to impose the taxes in question. Nothing in either the text or legislative history of the 1938 Act suggests that Congress intended to permit States to tax tribal royalty income generated by leases issued pursuant to that Act. The Act contains no explicit consent to state taxation, nor is there any indication that it was intended to incorporate implicitly the 1924 Act's taxing authority. The 1938 Act's general repealer clause cannot be taken to incorporate consistent provisions of earlier laws, and surely does not satisfy the requirement that Congress clearly consent to state taxation. Moreover, the language of the 1924 Act's taxing provision belies chanrobles.com-red

Page 471 U. S. 760

any suggestion that it carries over to the 1938 Act, since the words "such lands" in the taxing provision refer to lands subject to mineral leases under the 1891 Act and its 1924 amendment. Pp. 471 U. S. 766-768.

729 F.2d 1192, affirmed.

POWELL, J., delivered the opinion of the Court, in which BURGER, C.J.,and BRENNAN, MARSHALL, BLACKMUN, and O'CONNOR, JJ., joined. WHITE, J., filed a dissenting opinion, in which REHNQUIST and STEVENS, JJ., joined, post, p. 471 U. S. 768. chanrobles.com-red

Page 471 U. S. 761