Governor Mary Fallin and Muscogee (Creek) Nation Principal Chief George Tiger Friday signed a tobacco compact between the state of Oklahoma and the Creek Nation.

Governor Mary Fallin and Muscogee (Creek) Nation Principal Chief George Tiger Friday signed a tobacco compact between the state of Oklahoma and the Creek Nation. 

The compact includes the settlement of a lawsuit filed by the Attorney General’s Office regarding the sale of tobacco. The compact will result in payment of $11.5 million and dismissal of litigation by the state and the tribe. The agreement allows for a five-year term for settlement of payments.

The compact governs the payment of taxes to the state on the retail sale of cigarettes and other tobacco products sold on Creek Nation lands. The Oklahoma tax on cigarettes is $10.30 on a 10-pack carton; under this compact, Oklahoma will receive 50 percent of that tax rate from retail sales by the Creek Nation. The compact recognizes the right of the Creek Nation to charge additional amounts based on its own determination of tax needs.

“The state of Oklahoma values the financial, economic and cultural contributions of its Indian tribes. This compact between the Muscogee (Creek) Nation and the state of Oklahoma resolves past disputes and marks a new spirit of partnership between the state and the tribe,” Fallin said.

“I want to thank Chief George Tiger for his leadership in resolving past disputes and appreciate the spirit of cooperation exhibited by him and the Creek Nation during the negotiation of this compact. I also want to thank Attorney General Scott Pruitt for his diligent work in securing a settlement that allows for this compact to be signed.”

Tiger said, “It was time for our Nation and the State of Oklahoma to work together towards our common goals. The tobacco compact will resolve the outstanding litigation and disputes between the Nation and the state of Oklahoma and will provide a way for our community smoke shops to sustain themselves in a struggling economy. I am pleased that we can finally put this issue to rest and our Nation can focus on our citizens and other issues of importance to our people.”

Attorney General Scott Pruitt said, “The state’s lawsuit was about assuring equity among retailers in the marketplace and protecting the state’s interests. We achieved those goals through this unprecedented settlement. I appreciate the efforts of Governor Fallin and her staff in working with the AG’s Office and Chief George Tiger to negotiate the terms of the compact.”

Although the compact regulates the appropriate collection of taxes on tobacco products, both the state and the Creek Nation are committed to reducing dependence on tobacco.  The parties are encouraged that sale of cigarettes has declined in Oklahoma since 2004.

The compact with the Creek Nation is the first tobacco compact negotiated by Governor Fallin. The governor said her administration is willing to work with other tribal governments that wish to negotiate tobacco compacts.