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Michigan Smoking Tax Hike, Racinos Linked

LANSING, Michigan – As reported by the Detroit News: "Lawmakers are edging close to voting on Gov. Jennifer Granholm's state budget-balancing proposal to increase the cigarette tax by 75 cents a pack, and on a separate plan pushed by the horse racing industry to put up to 500 video slot machines and other gaming devices at each of the state's seven horse tracks.

"The two issues have become entangled. Here's why: House Speaker Rick Johnson, R-LeRoy, and others supporting the so-called 'racino' package need Democratic votes to get it passed in the Senate. The House approved the legislation nearly a year ago.

"Senate Democratic Leader Bob Emerson of Flint has told leaders he's not going to rustle up votes for racinos if Republicans then intend to say the tobacco tax hike is unnecessary because the slot machines will generate the cash needed to erase the budget deficit.

"…The racetrack slot machines could yield anywhere from $197 million to $400 million a year, according to state fiscal analysts. Other research indicates the slots will hurt existing casinos and could wind up costing the state tax receipts and jobs…"

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