By KEVIN FREKING
Associated Press Writer
from YAHOO! NEWS

WASHINGTON - The nation’s 45 million smokers will probably help pay for the spending increase that Democrats want for children’s health insurance, say analysts familiar with deliberations on Capitol Hill.

Democratic lawmakers will push for $50 billion in new funding for the State Children’s Health Insurance Program over the next five years. To pay for that increase, they must find new sources of revenue or cut existing programs.

Powerful trade groups representing doctors, hospitals and insurers have united around the idea of taxing tobacco. Democratic leaders have not said to what extent they will agree.

Still, the question now is not whether the tobacco tax will go up - but how much it will go up, said Ron Pollack, executive director of Families USA, an advocacy group that promotes universal health insurance.

“I’ve every reason to believe an increase in the tobacco tax will be part of the way expanded health insurance for children is paid for,” Pollack said.

Pollack said his assessment was based on “frequent and relatively recent conversations” with the committees that have jurisdiction over SCHIP. Democrats from the House and the Senate are expected to unveil their respective SCHIP proposals soon.

The federal tax on tobacco stands at 39 cents per pack, and it generated about $7.2 billion in 2005. The money goes into the general fund of the U.S. Treasury.

States also tax cigarettes. The rates range from $2.58 cents a pack in New Jersey to 7 cents a pack in South Carolina.

read more at YAHOO! NEWS