One of the proposed measures in President Obama’s budget would increase the federal tobacco tax to $1.95 per pack
Among the new taxes proposed in President Obama’s fiscal 2016 budget is an increase to the tax on tobacco products. The administration proposes to nearly double taxes on cigarettes and small cigars to about $1.95 per pack — from about $1.01 per pack — and index the tax for inflation.
The increased taxes would bring in approximately $95 billion in revenue, which would be set aside to pay for two of the president’s key initiatives. Approximately $11.8 billion would go toward an extension of the Children’s Health Insurance Program, part of the Affordable Care Act which is due to end in September if Congress doesn’t revive it, and early childhood education programs and an early childhood home visit program, part of ongoing proposals to guarantee universal access to preschool.