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Earlier this year, the U.S. Senate and U.S. Representatives passed legislation that would have increased the federal cigarette excise tax by 61 cents to $1.00 per pack. The proceeds would have been used to fund the State Children's Health Insurance Program. Unfortunately, this proposal was vetoed twice by the President. Before adjourning in December 2007, Congress passed legislation that will extend the program through March 2009. While this extension ensures that children who currently receive their health insurance through this program will maintain their benefits, the program was not expanded to help the millions of uninsured children in the U.S., including those with lung diseases such as asthma. The legislation also did not increase the federal cigarette excise tax. A 61-cent increase in the federal cigarette tax would have the added benefit of discouraging kids from starting to smoke.
Below are a series of quotes from Members of Congress highlighting the win-win proposition of increasing the federal excise tax to pay for the State Children’s Health Insurance Program (SCHIP).
We increase the Federal tax on cigarettes by 61 cents, and we make proportional increases for other tobacco products. Increasing the cigarette tax will also discourage smoking, particularly among teens. And that will be good for kids, too.
– Senator Max Baucus (D-Montana)
SCHIP is paid for by an increased tax on cigarettes, not by raiding the Treasury. That tax will itself save us countless dollars and lives by discouraging smoking. We have had extensive hearings in our human resources committee, the HELP Committee, about what happens when the cost of cigarettes escalates, and when the cost of cigarettes escalates, as included in this CHIP program, it has a dramatic impact on lessening the demand among teenagers and smoking. What has happened for years is that the industry itself has increased its advertising in order to try to hook these children back in. But this has a dramatic positive impact from a preventive point of view in helping children not become addicted to nicotine and cigarette smoking, so it is a win-win situation. It is using the private insurance companies' own model that was initially suggested by the President of the United States in the Medicare prescription drug program, and it is being paid not by the taxpayers but by the cigarette users. That will discourage smoking and will have a positive impact on children.
– Senator Ted Kennedy (D-Massachusetts)
I find that an increase in the tobacco tax is an appropriate avenue to help finance health coverage for low-income children. The health complications caused by smoking--for instance, the increased risk of lung cancer and heart disease as well as the clear relationship between the number of cigarettes smoked during pregnancy and low birth weight babies--could not be more evident. It is clear to me that investing in children's health, while at the same time discouraging children from starting to smoke in the first place, is the best form of cost-effective, preventative medicine.
– Senator Olympia Snowe (R-Maine)
In my view as chairman of the Congressional Prevention Caucus, an increase in the Federal tobacco tax is sound public health policy. It provides a reliable revenue source to offset the costs of expanding coverage to low-income children and it will reduce health care costs in this country by reducing the prevalence of chronic disease.
– Congressman Jim Moran (D-Virginia)
It is fully paid for by an increase in the cigarette tax, but economists tell us that as a result of the increase in the cigarette tax, there are going to be millions of people who will either stop smoking or will never start smoking--particularly young people who won't start smoking now because of the extra cost in buying a pack of cigarettes. The Presiding Officer and I know how much that will save in our health care system for someone who doesn't smoke. That is not figured into the cost estimates here, the savings we will have to our health care system because of the number of children who will never start smoking.
– Senator Ben Cardin (D-Maryland) | 
