Indiana lawmakers propose using cigarette tax for Medicaid

Indiana
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INDIANAPOLIS (AP) — A House committee has made significant changes 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 Thursday to direct 40% of Indiana’s cigarette tax revenue toward Medicaid reimbursements for health care providers. An earlier version of the bill would have deposited a majority of the new $290 million a year in revenue generated by the tax hike into the state’s general fund and pension programs.

The proposal would add $1 to the state’s current 99.5 cents per pack cigarette tax and charge a 39% tax on the liquids used in e-cigarettes.

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