Cigarette tax

A proposal headed to the state House Ways and Means Committee would add $1 to the state’s current 99.5 cents per pack cigarette tax.

INDIANAPOLIS — A House committee made significant changes Thursday to the way Indiana would spend proceeds from a proposal to hike the state’s cigarette tax for the first time in more than a decade and impose a new state tax on vaping liquids.

House legislators revised the measure in committee to direct 40 percent of Indiana’s cigarette tax revenue toward Medicaid reimbursements for health care providers. That’s a change from the original proposal, which would have deposited a majority of the new revenue generated by the tax hike – estimated to be nearly $290 million a year – into the state’s general fund and pension programs.

Casey Smith is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.

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