Indiana House rejects cigarette tax increase to fund health care coverage

The Indiana House on Tuesday voted 52-44 against a bill (HB 1008) that would have raised the state's cigarette tax by 25 cents per pack to fund health coverage for low-income, uninsured residents, the Evansville Courier & Press reports.

The tax was expected to generate an estimated $130 million annually. Combined with federal matching funds and participant costs, the tax increase would have generated an estimated $480 million annually.

The funds would have been used to provide health coverage for about 120,000 state residents in families with annual incomes of less than 200% of the federal poverty level. Jane Jankowski, Gov. Mitch Daniels' (R) press secretary, said Daniels, who supported the tax increase, was "surprised and disappointed in the outcome but is hopeful there is still a way to move forward effectively to reduce Indiana's smoking rate, immunize more children and expand health care coverage for working" Indiana residents (Evansville Courier & Press, 2/28).