{"id":72626,"date":"2026-02-11T14:16:51","date_gmt":"2026-02-11T19:16:51","guid":{"rendered":"https:\/\/bridgemi.com\/?p=72626"},"modified":"2026-02-11T14:33:19","modified_gmt":"2026-02-11T19:33:19","slug":"gretchen-whitmer-raise-800m-taxing-nicotine-gambling-and-ads-for-medicaid","status":"publish","type":"post","link":"https:\/\/bridgemi.com\/michigan-government\/gretchen-whitmer-raise-800m-taxing-nicotine-gambling-and-ads-for-medicaid\/","title":{"rendered":"Gretchen Whitmer: Raise $800M for Medicaid by taxing nicotine, gambling, ads"},"content":{"rendered":"\n<ul class=\"wp-block-list\">\n<li><strong>Gov. Gretchen Whitmer wants to implement five new taxes to fund Michigan\u2019s Medicaid program amid declining federal funding<\/strong><\/li>\n\n\n\n<li><strong>The proposed taxes would target digital ads, nicotine products and sports betting<\/strong><\/li>\n\n\n\n<li><strong>Republican leaders in the Legislature quickly call the tax hike proposal a nonstarter<\/strong><\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-wide\"\/>\n\n\n\n<p>LANSING \u2014 Citing a looming funding shortfall for Medicaid health insurance, Democratic Gov. Gretchen Whitmer is proposing nearly $800 million in new taxes \u2014 along with some spending cuts \u2014 to close the gap.&nbsp;<\/p>\n\n\n\n<p>But the six tax proposals outlined in a budget proposal released Wednesday were met by immediate opposition from Republicans who control the state House, meaning the plan faces long odds.&nbsp;<\/p>\n\n\n\n<p>The funding gap identified by the Whitmer administration emerged from President Donald Trump\u2019s \u201cbig, beautiful\u201d tax and spending law, which endangered the tax Michigan levies on insurance providers.&nbsp;<\/p>\n\n\n\n<p>To \u201censure long-term sustainability\u201d of the publicly funded health insurance program, Whitmer is proposing:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A new 4.7% tax on digital ads served in Michigan, estimated to generate $282 million a year<\/li>\n\n\n\n<li>An increase in the wholesale taxes on cigarettes of $1 per pack, from $2 to $3, raising an estimated $232 million<\/li>\n\n\n\n<li>An 8 percentage point tax increase on online casino gambling revenue above $185 million, bringing in an estimated $136 million<\/li>\n\n\n\n<li>A new 57% wholesale tax on vapes and other nicotine-delivery products <a href=\"https:\/\/bridgemi.com\/michigan-government\/michigan-gov-gretchen-whitmer-proposes-new-tax-vapes-nicotine-pouches\/\">like Zyn<\/a>, which currently are not taxed, to raise an estimated $95 million<\/li>\n\n\n\n<li>A new per-wager tax on sports betting that would be 25 cents for a gambling platform&#8217;s first 20 million wagers per year, then 50 cents for each bet above that. It is estimated to raise $39 million<\/li>\n<\/ul>\n\n\n\n<p>Whitmer also wants to stop allowing sports betting houses to deduct free promotional bets from their taxes, generating $21 million<\/p>\n\n\n\n<p><strong>RELATED:<\/strong>&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong><a href=\"https:\/\/bridgemi.com\/michigan-government\/michigans-bipartisan-budget-deal-aims-to-protect-medicaid-heres-how\/\">Michigan\u2019s bipartisan budget deal aims to \u2018protect\u2019 Medicaid. Here\u2019s how<\/a>&nbsp;<\/strong><\/li>\n\n\n\n<li><strong><a href=\"https:\/\/bridgemi.com\/michigan-government\/trump-gets-his-big-beautiful-bill-what-it-means-michigan\/\">Trump gets his &#8216;big, beautiful bill.&#8217; What it means for Michigan<\/a>&nbsp;<\/strong><\/li>\n\n\n\n<li><a href=\"https:\/\/bridgemi.com\/michigan-government\/report-big-beautiful-bill-will-blow-11-billion-hole-michigan-budget\/\"><strong>Report: \u2018Big, beautiful bill\u2019 will blow $1.1B hole in Michigan budget<\/strong><\/a><\/li>\n<\/ul>\n\n\n\n<p>The state must \u201cexplore new and innovative solutions to ensure the long-term sustainability of the Michigan Medicaid Program for the one in four Michiganders who rely on it,\u201d the Whitmer administration said in a policy outline.<\/p>\n\n\n\n<p>Republican lawmakers aren\u2019t on board. \u201cWe&#8217;re not going to do any of that,\u201d House Speaker Matt Hall said at a press conference Wednesday.<\/p>\n\n\n\n<p>\u201cThere will be no tax increases in this budget when we do this deal,\u201d added Hall, R-Richland Township. \u201cInstead, we&#8217;re going to have to live within our means, just like the people of Michigan do when they have increased expenses.\u201d&nbsp;<\/p>\n\n\n\n<p>Several of Whitmer\u2019s proposals aren\u2019t new. She had called for new taxes on nicotine products as well as on digital ads in last year\u2019s budget recommendation, with <a href=\"https:\/\/bridgemi.com\/michigan-government\/whitmers-3b-plan-fix-michigan-roads-calls-more-corporate-marijuana-taxes\/\">the latter pitched<\/a> as a means to fund road repairs.&nbsp;<\/p>\n\n\n\n<p>Whitmer also proposed nicotine-related taxes last year to fund \u201csmoking and cancer prevention, youth mental health and physical health and access to health care.\u201d Now, a little more than $21 million of the $232 million would go to those health-related efforts, and the rest to fund Medicaid.<\/p>\n\n\n\n<p>Some Democrats were also skeptical that Whitmer&#8217;s new tax proposal has any shot in the Legislature, with state Sen. Veronica Klinefelt of Eastpointe asking if the administration has a &#8220;plan B&#8221; for Medicaid.&nbsp;<\/p>\n\n\n\n<p>&#8220;Every single one&#8221; of the tax proposals were discussed during last year&#8217;s road funding debate, &#8220;and they went nowhere,&#8221; Klinefelt said. &#8220;So I don&#8217;t have a lot of optimism on where they&#8217;re going to go.&#8221;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Medicaid in Michigan<\/strong><\/h2>\n\n\n\n<p>The stakes are high in Michigan, where Medicaid provides health insurance to more than 2.6 million people, primarily with lower-than-average incomes.<\/p>\n\n\n\n<p>Michigan will have to find a way to sustain funding for Medicaid or reduce coverage, restrict benefits or lower the amount paid to health care providers.<\/p>\n\n\n\n<p>\u201cStates across the country are cutting the rates paid to health care providers,\u201d said state budget director Jen Flood. \u201cThat\u2019s not an approach we\u2019re taking with this budget.\u201d<\/p>\n\n\n\n<p>Kyle Guerrant, the outgoing deputy state budget director, said the change from federal legislation \u201cputs immediate pressure on the same limited pool of general fund resources to support our broader priorities,\u201d meaning that without additional revenue, cuts would have to take place elsewhere.<\/p>\n\n\n\n<p>The most recent state budget brought some changes aimed at maintaining current Medicaid spending over the next year, but long-term funding to cover the shortfall remains largely unknown.&nbsp;<\/p>\n\n\n\n<p>One aspect of the plan to fully fund Medicaid was left relatively vague: pledging the state Department of Health and Human Services could achieve $150 million in annual \u201cefficiency savings by developing a menu of options, in collaboration with key stakeholders, to ensure Medicaid services are sustainable into the future,\u201d according to budget documents.&nbsp;<\/p>\n\n\n\n<p>State Budget Director Jen Flood said 200,000 Michiganders could lose health care coverage due to Trump\u2019s tax-and-spend law even with the funding gap bridged. A Congressional Budget Office <a href=\"https:\/\/www.cbo.gov\/publication\/61882\">report<\/a> released Wednesday said the federal legislation will also increase federal debt by $4.7 trillion over the next decade, a significant increase over a prior $3.4-trillion estimate.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Gov. Gretchen Whitmer pitches $800M in new taxes as a way to ensure the \u2018sustainability\u2019 of Medicaid in Michigan. Republicans say no way.<\/p>\n","protected":false},"author":1215,"featured_media":72627,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","inline_featured_image":false,"apple_news_api_created_at":"2026-02-11T19:16:55Z","apple_news_api_id":"fda1572e-e935-474d-81f9-e28d8100a7b6","apple_news_api_modified_at":"2026-02-11T19:33:18Z","apple_news_api_revision":"AAAAAAAAAAAAAAAAAAAAAg==","apple_news_api_share_url":"https:\/\/apple.news\/A_aFXLuk1R02B-eKNgQCntg","apple_news_cover_media_provider":"image","apple_news_coverimage":0,"apple_news_coverimage_caption":"","apple_news_cover_video_id":0,"apple_news_cover_video_url":"","apple_news_cover_embedwebvideo_url":"","apple_news_is_hidden":"","apple_news_is_paid":"","apple_news_is_preview":"","apple_news_is_sponsored":"","apple_news_maturity_rating":"","apple_news_metadata":"\"\"","apple_news_pullquote":"","apple_news_pullquote_position":"","apple_news_slug":"","apple_news_sections":[],"apple_news_suppress_video_url":false,"apple_news_use_image_component":false,"_newspack_byline_active":false,"_newspack_byline":"","newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false},"categories":[2445],"tags":[904],"newspack_spnsrs_tax":[],"coauthors":[2467],"class_list":["post-72626","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-michigan-government","tag-gov-gretchen-whitmer","entry"],"apple_news_notices":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Gretchen Whitmer: Raise $800M for Medicaid by taxing nicotine, gambling, ads - Bridge Michigan<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/bridgemi.com\/michigan-government\/gretchen-whitmer-raise-800m-taxing-nicotine-gambling-and-ads-for-medicaid\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Gretchen Whitmer: Raise $800M for Medicaid by taxing nicotine, gambling, ads - Bridge Michigan\" \/>\n<meta property=\"og:description\" content=\"Gov. Gretchen Whitmer pitches $800M in new taxes as a way to ensure the \u2018sustainability\u2019 of Medicaid in Michigan. Republicans say no way.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/bridgemi.com\/michigan-government\/gretchen-whitmer-raise-800m-taxing-nicotine-gambling-and-ads-for-medicaid\/\" \/>\n<meta property=\"og:site_name\" content=\"Bridge Michigan\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/BridgeMichigan\/\" \/>\n<meta property=\"article:published_time\" content=\"2026-02-11T19:16:51+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-02-11T19:33:19+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/bridgemi.com\/wp-content\/uploads\/2026\/02\/Elconin_GW_11.webp\" \/>\n\t<meta property=\"og:image:width\" content=\"1024\" \/>\n\t<meta property=\"og:image:height\" content=\"683\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/webp\" \/>\n<meta name=\"author\" content=\"Simon D. 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