Illinois tobacco tax
Fri May 25, 2012
Ill. House approves raised tobacco tax in plan to close Medicaid hole
The Illinois House has agreed to raise tobacco taxes as part of a plan to strengthen the state Medicaid program.
The tax increase passed 60-52 Friday. It now goes to the Senate, which has backed similar increases in the past.
It more than doubles the tax on cigarettes, to $1.98 a pack. Other tobacco products would see a similar tax increase.
It also would create a special tax on hospitals that would then be matched by the federal government and returned to the state.
In all, it's supposed to raise $800 million a year for the Medicaid program.
Officials yesterday approved deep Medicaid cuts. The taxes and cuts are supposed to close a $2.7 billion hole in the Medicaid budget.