Sorry smokers, the federal cigarette tax will soon be $1 per pack, a 61 cent increase, if the Senate Finance Committee has its way. Both chambers of Congress agree that a higher tax is needed to help finance an expansion of the Children’s Health Insurance Program. From the Times-News Online:

Under current law, the federal government provides $5 billion a year to states for the Children’s Health Insurance Program, which covered 7.4 million people at some time in the last year. The bipartisan Senate plan would add $35 billion, bringing the five-year total to $60 billion. House Democrats, by adding $50 billion to the current level of spending, would increase the total to $75 billion. Mr. Bush, by contrast, has proposed an increase of $5 billion and has denounced the Democratic proposals as a step toward “government-run health care” for all.

State governments are gung-ho to fund healthcare initiatives by raising cigarette taxes, so it is no surprise that the federal government wants a piece of the ‘tax for health’ fun, too. Don’t gross us out and try to escape the federal government’s expansive taxing maw by switching to chewing tobacco; the new tax will apply “proportional increases” to all tobacco products. The Senate Finance Committee is expected to vote on the measure tonight.

Panel Accord on Increasing Cigarette Tax [Times-News Online]
S. 1224 – Children’s Health Insurance Program (CHIP) Reauthorization Act of 2007 [THOMAS]
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