In the case of Kerr-McGee Corp. v. Navajo Tribe of Indians et al., 1984, the U.S Supreme Court ruled in favor of Kerr-McGee Corporation, a mining company that had been levied with taxes by the Navajo Tribe for uranium mining on tribal lands. The tribe argued that they were entitled to impose such taxes under their inherent sovereignty and federal law which allowed them to manage resources on their land. However, Kerr-McGee contended these taxes were pre-empted by federal laws governing nuclear energy production and violated terms set out in previous agreements between themselves and the tribe. The court held that while tribes do have certain sovereign powers over activities within their jurisdiction, this does not extend to imposing taxes on non-tribal entities without express authorization from Congress – something which was lacking here. Furthermore, it found no conflict between tribal taxation rights and federal regulation of nuclear energy as claimed by Kerr-McGee; rather both could coexist harmoniously if properly balanced through negotiation or legislation.

In the dissenting opinion for Kerr-McGee Corp. v. Navajo Tribe of Indians, Justice White argued that the majority's decision was inconsistent with previous rulings and federal policy regarding tribal sovereignty. He contended that the Court had previously recognized tribes' inherent power to tax non-Indian activities on reservation lands, unless explicitly prohibited by Congress. In this case, he saw no such prohibition from Congress against the Navajo Tribe imposing a severance tax on uranium mining operations within their territory. Furthermore, he believed that affirming tribal taxation rights would align with federal policies aimed at promoting self-sufficiency and economic development among Native American communities. Therefore, in his view, denying these rights could undermine those objectives.