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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowThe Indiana General Assembly delivered mixed results for public health in the budget it passed last week, just before adjourning for the year.
Lawmakers made big cuts in spending on public health programs just two years after they finally, after years of discussion, started making that line item a priority. But they also tripled the state’s tobacco taxes, a move that research has shown will prevent many young people from starting to smoke and could encourage current smokers to quit.
The Indiana Chamber of Commerce, Indy Chamber, other business organizations (and IBJ) have for years called for a hike in the cigarette tax. At 99.5 cents per pack, Indiana’s existing tax rate is 39th-lowest in the nation and hasn’t increased since 2007.
The budget approved last week increases the tax by $2 per pack and imposes similar increases on other tobacco products, including vaping products.
“A healthy state is good for business,” Indiana Chamber President Vanessa Sinders said in an email to chamber members after the vote. “Reducing our smoking levels will increase employee wellness, lower health care costs for employers and reduce absenteeism in the workplace.”
Lawmakers didn’t appear to hike the tax for that reason. They were trying to fill a gap in the budget that appeared after a revenue forecast predicted the state would collect $2.4 billion less in taxes through June 30, 2027, than lawmakers expected when they started working on the two-year spending plan.
Before those projections, the budget plans endorsed by both the House and Senate hadn’t included a cigarette tax increase. Nor had there been any real public discussion about it. But the tobacco tax increases are expected to generate $800 million over the next two years, which will help the state pay for rising costs in the Medicaid program, where enrollment remains higher than before the pandemic.
Regardless of why lawmakers passed the tax increase, it’s a good idea. Anything that discourages smoking and vaping will save the state and employers money in the long run.
That’s also why we support robust spending on public health programs and were so excited that lawmakers in 2023 approved an unprecedented 1,500% increase in public health funding, allocating $75 million in fiscal year 2024 and $150 million in 2025 to fund county health departments.
Since then, all 92 counties have opted into the funding, which requires a local match, and have implemented a variety of programs—including tobacco cessation, lead abatement, immunizations and maternal health—that are meant to address the specific needs of their communities.
But with tax revenue slowing, lawmakers signaled early this year that they would pull back on that spending. Then, after the late-session revenue forecast, they slashed the allocation for county health departments to $40 million a year.
That’s still significantly more than Indiana was dedicating to public health before 2023, and the decision is understandable in context. Still, it’s disappointing.
We hope the cigarette tax increase will have the impact on smoking that research predicts it will. And maybe in two years, lawmakers can return to robust public health funding, as well.•
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If smokers are going to be penalized for an unhealthy habit then it’s time to penalize the obese. There are many more obese residents in Indiana than smokers, and they are a bigger drain on the healthcare system. Let’s see what and when the lawmakers do something about this expensive problem.