This bill amends section 77-2602 of the Revised Statutes Cumulative Supplement, 2024, to increase the cigarette tax and specify the distribution of the tax proceeds. The legislation highlights the significant Medicaid expenses incurred by the State of Nebraska due to smoking-related illnesses, which exceed one hundred twenty million dollars annually. It states the intent to allocate a portion of the cigarette tax revenue to support Medicaid. The new tax rate will be set at one dollar and sixty-four cents per package of cigarettes, with a portion of the proceeds designated for various funds, including the Nebraska Health Care Cash Fund, which will receive ninety-seven cents of the tax plus an additional one million two hundred fifty thousand dollars.

The bill also establishes an operative date of July 1, 2026, and repeals the original section 77-2602. It emphasizes the importance of projects funded from the Building Renewal Allocation Fund and mandates that any reductions in the cigarette tax rate must be accompanied by equivalent reductions in the amount dedicated to the General Fund. The bill is declared an emergency measure, allowing it to take effect immediately upon passage and approval.

Statutes affected:
Introduced: 77-2602