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Michigan House Approves Higher Cigarette Tax

LANSING, Mich. -- The Michigan House on Wednesday narrowly approved a 75-cent-per-pack cigarette tax increase but added an amendment, which returns the bill to the Senate, reported the Associated Press.

After lengthy deliberations, the House voted 55-52 on the bill to raise the tax on a pack of cigarettes and other tobacco products from $1.25 to $2 beginning July 1. The House amended the bill to require the state health department to use half of the state's $3 million designated for smoking prevention on expanding Michigan's program to help people to quit smoking.

The change returns the bill to the Senate, which approved the bill on Tuesday.

Wednesday's House action keeps in place changes made by the Senate to eventually put some of the revenue generated by the higher cigarette tax toward the general fund. Under the bill, all of the new revenue generated by the higher cigarette tax would go to the state's Medicaid program in the current fiscal year and the fiscal year that begins Oct. 1.

Twenty-five percent of the revenue would be set aside for the state's general fund in the budget year that begins on Oct. 1, 2005. The remaining 75 percent would continue to help fund Medicaid.
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