The Memorandum of Understanding is an Agreement between the First Nations Tax Commission and the Minister of Indian Affairs and Northern Development.  In1988 an amendment was made to the Indian Act giving First Nations jurisdiction over real property taxation on Reserve.

Subsequent legislation in 2005 expanded this First Nations jurisdiction under the First Nations Fiscal and Statistical Management Act (FSMA) by establishing a Commission and by conferring powers on First Nations who opt into a system established by the FSMA to pass local revenue laws.

In short, First Nations can exercise their jurisdiction over real property taxation either under the Indian Act which requires Ministerial approval, or under the FSMA requiring approval by the Commission.

Follow the link for full details of the Memorandum of Understanding