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New Taxes And Tax Hikes Included In Governor's Budget Plan

BOSTON (AP) — Gov. Deval Patrick will propose hiking the Massachusetts cigarette tax by 50 cents per pack as part of a plan to raise $260 million in new revenues for the state budget, the administration said Friday.

The governor's plan also seeks to impose the state's 6.25 percent sales tax on candy and soda — both items are currently exempt from the tax — and expand the state's bottle deposit law to include bottled water, sports drinks and other beverages.

In addition to increasing the cigarette tax from $2.51 per pack to $3.01 per pack, a 20 percent increase, the plan would double the taxes paid on other tobacco products such as cigars and smokeless tobacco. The tobacco tax hike was expected to raise $73 million, officials said, with the money earmarked to help offset the cost of a recent decision by the state's highest court that cleared the way for thousands of legal immigrants to join Commonwealth Care, the state's subsidized health insurance program.

Patrick was scheduled to unveil his proposed state budget for the fiscal year starting July 1 on Wednesday. While the state is anticipating a 4.5 percent increase in total revenues in the next fiscal year, budget officials have warned that most, if not all of the additional money flowing into state coffers will be swallowed up by rising health care expenses and other fixed costs.

 (© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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