Senate Finance panel approves SCHIP extension, expansion

The Senate Finance Committee on January 15 approved legislation to renew and expand the State Children’s Health Insurance Program (SCHIP) by a vote of 12 to 7. The $31.5 billion measure funds investment in the SCHIP program with a 61 cent increase in Federal tax on cigarettes, with proportional increases for other tobacco products, raising approximately $65 million over 10 years. The House passed a similar measure (HR 2) on January 14 by a vote of 289-13. The full Senate is expected to take-up its version during the week beginning January 19.

The revenue is primarily raised through excise tax increases in tobacco tax rates and to a lesser degree by modifying certain definitions pertaining to tobacco products. The measure modifies the definition of roll-your-own tobacco and strengthens regulatory and enforcement authority with respect to tobacco and alcohol.