A U.S. Supreme Court case on the scope of a 19th century treaty may have far reaching consequences on tax and state sovereignty.

The case centers on a fuel import tax dispute between Washington state and a gas station on tribal land. Other states are closely watching the outcome, and have raised concerns that a ruling against Washington could cost other states billions of dollars in lost tax revenue from fuel and tobacco. The court will hear arguments Oct. 30 in the case, Washington State Department of Licensing v. Cougar Den Inc.

The outcome could have a broad impact on...