Researcher: JS Page 1 3/25/25
OLR Bill Analysis
SB 1188
AN ACT ESTABLISHING A PROPERTY TAX EXEMPTION FOR
PROPERTY LOCATED ON CERTAIN INDIAN LANDS.
SUMMARY
This bill establishes a property tax exemption for real property and
personal property located on reservation land that is held in trust for a
federally recognized Indian tribe. The exemption applies regardless of
ownership (i.e. it applies to Indian and non-Indian owned property).
With exceptions, federal law precludes taxing federally recognized
tribes for real or personal property they own, and in some cases lease,
on their reservations (see BACKGROUND). Additionally, existing state
law specifically exempts from property tax (1) reservation land held in
trust by the state and (2) motor vehicles garaged on a reservation that
tribal members or their spouses own (CGS ยง 12-81(2) & (71)).
EFFECTIVE DATE: October 1, 2025, and applicable to assessment
years starting on or after that date.
BACKGROUND
Related Case Law
The U.S. Supreme Court has ruled that under the U.S. Constitution
states may not tax federally recognized Indian reservations and the
Indians on them without clear congressional authorization to do so
(Oklahoma Tax Commission v. Chickasaw Nation, 515 U.S. 450
(1995)). Local governments, as political subdivisions of the states, are
generally subject to the same limitation.
Federal law does not necessarily preempt taxing non-Indian
businesses or non-Indian property on reservations. In Mashantucket
Pequot Tribe v. Town of Ledyard, 722 F.3d 457 (2d Cir. 2013), the Second
Circuit Court of Appeals held that the town could levy personal 2025SB-01188-R000202-BA.DOCX
Researcher: JS Page 2 3/25/25
property taxes on slot machines owned by a non-Indian lessor and
leased to the tribe for its exclusive use for on-reservation gaming. In
doing so, it overturned a decision by the district court that found the
property tax to be preempted by federal law.
COMMITTEE ACTION
Planning and Development Committee
Joint Favorable
Yea 20 Nay 0 (03/07/2025)