SACRAMENTO — Deron Marquez, 33, drives a Mercedes coupe valued at more than $96,000 and oversees a high-profit business that generates tens of millions of dollars a year.
State and local authorities collect no tax on the business' profits or property, and for one of the two years he has owned his Mercedes-Benz, Marquez paid no vehicle license fee, state records show. By law, Marquez, like many Native Americans, didn't have to do so.
As chairman of the San Manuel Band of Mission Indians, he is one of roughly 26,000 Native Americans enrolled in the 53 California tribes that own casinos. Although some have grown wealthy on gambling profits, they need not pay many taxes shouldered by other Californians.
While other motorists brace for their license fees to triple, many Indians can shrug. If lawmakers raise the sales tax, many Native Americans will be unaffected. And it would be no big deal if lawmakers raised the state income tax on the richest Californians, as Gov. Gray Davis suggested early this year.
Davis, struggling to fill the state's $38-billion budget hole, raised the issue of taxes and tribes in January by proposing that an expansion of Indian gambling be dependent on tribes' agreeing to give the state $1.5 billion a year.
Since then, the governor, facing a recall campaign, has reduced that request to $680 million for this fiscal year. Most tribes have resisted, so far successfully. Those sovereign groups are among the most influential interests in California, having spent more than $120 million on state politics in the last five years.
"No state tax of any kind applies to a tribe unless Congress expressly allows it," said lawyer Art Bunce, who represents the Agua Caliente Band of Cahuilla Indians, owners of a casino in downtown Palm Springs and one off Interstate 10.
That dismays activists and local officials most affected by the traffic, noise and demands on public services that accompany casinos and the crowds they draw, as well as some Capitol denizens alarmed by the depth of the state's financial morass.
"Major business making major money ought to be paying taxes," said Lenny Goldberg, a lobbyist and head of the labor-backed California Tax Reform Assn., a nonprofit group that advocates higher taxes as a way to solve the state's yawning budget gap.
Tribes' Tradeoff
