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As good an argument for tax simplification as any



26 U.S.C. ยง 3306(c)(7) excepts from the definition of "employment"—and thus exempts from the payment of employment tax—"services performed in the employ of an Indian tribe, or any instrumentality" of a tribe. Thus, the Ninth Circuit holds in Blue Lake Rancheria v. United States, a 53-member tribe can create a corporation that "hires" existing workers at other companies, rent those employees back to their original employers, and split the tax savings. Everyone wins! Except taxpayers. [Martin via Wallace]

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.