LANSING, MI (WTVB) – Governor Gretchen Whitmer’s proposed fiscal year 2027 budget includes significant tax hikes on tobacco and gaming to address a projected $1.8 billion shortfall in Michigan’s Medicaid funding.
The plan, to be presented to the Legislature today , calls for raising the per-pack cigarette tax from $2 to $3 and increasing the wholesale tax on other tobacco products from 32% to 57%. Additionally, the governor is seeking a new 57% wholesale tax on vaping products and nicotine pouches, which are currently untaxed, to generate an estimated $95 million annually for public health and youth mental health services.
The budget proposal also targets the gaming industry, seeking higher taxes to help stabilize the state’s General Fund as federal pandemic-era subsidies expire.
State Budget Director Jen Flood described the measures as part of a “responsible mix” of revenue enhancements and efficiencies intended to protect healthcare coverage for approximately 2.5 million residents on Medicaid.
While the Whitmer administration argues these “sin taxes” are necessary to avoid drastic cuts to core services, they are expected to face stiff opposition from Republican lawmakers who have voiced concerns over creating new financial burdens for Michigan families.
Sure taxs the nic product, I will quit. Please leave the video games out of it they are already expensive @ 60$ for a basic game copy for some people like me that uses game for mental health issues to escape reality and not take my anger out on the real world. And for the people that will hate on me. There are 1000’s of people just like me
Maybe an alcohol tax increase should also be applied. After all it is also leisure.
Wow now she is coming after games