U.S. Senate Passes Tobacco Tax Increase to Fund SCHIP January 30, 2009

On January 29, the U.S. Senate overwhelmingly approved, 66 to 32, legislation that increases the federal cigarette tax by 61 cents to $1.00 per pack. The federal tax on little cigars will also immediately increase to $1.00 per pack, and taxes on other tobacco products will increase. The revenue will be used to expand coverage to an estimated 4 million more children under the State Children’s Health Insurance Program or SCHIP. The U.S. House of Representatives passed similar legislation earlier in January, except the increased tax on little cigars would have been phased in over six years. The House is expected to take up the Senate-passed version of the legislation next week. President Obama has indicated he will sign the bill into law once it reaches his desk. (Some information for this article obtained from: Ceci Connolly, Senate Passes Health Insurance Bill for Children, Washington Post, January 30, 2009, pp. A1&A4.)

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