DeWine proposes tax increases for cigarettes, sports gambling and a new child tax credit

Posted by author February 4, 2025 Gambling

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Ohio Gov. Mike DeWine proposed increased taxes on cigarettes and sports betting to fund programs in his new two-year budget.

DeWine announced his budget priorities for 2026-27 on Monday afternoon, primarily focusing on children’s health, safety and education.

DeWine wants lawmakers to approve a new child tax credit, changes to higher education admissions, fund a program to help young children get glasses and clean up the state’s water.

“I think it’s a very, very good budget for our kids, and I think it’s consistent with what we’ve done during the past,” he said.

Here’s a look at some of DeWine’s priorities laid out in the $218 billion budget plan:

A new child tax credit

DeWine, who has long focused on kids and public safety, wants to create a $1,000 annual refundable tax credit for Ohioans who have children under age 7. Working parents with a full-time minimum wage job would be eligible for the credit.

DeWine wants to pay for the child tax credit by increasing cigarette taxes to $3.10 per pack, up from the current $1.60 tax. The increase would generate an additional $319 million a year, according to the American Cancer Society, which supports the tax increase.

Ohio’s current cigarette tax is the 29th highest in the country. A higher per-pack price tends to steer kids away from starting a smoking habit.

“It really is time. I just see struggling families all over the state of Ohio, and, you know, they just need some help and this is a little help that we can give them,” DeWine said.

Higher tax on sports betting to pay for stadiums, youth sports

DeWine proposed raising the sports gaming tax from 20% to 40% to create a fund for professional sports facilities and youth sports education.

DeWine’s announcement comes as the Cleveland Browns prepare to move the team to a new domed stadium in Brook Park. The Cincinnati Bengals are also looking to make major renovations to Paycor Stadium.

He said the tax increase would bring in approximately $130 million to $180 million a year and the money would be allocated by a group appointed by the governor and the Legislature.

DeWine called sports betting companies “extremely aggressive” and said Ohioans lose massive amounts of money to them each year.

“It seems to be only just and fair that some stadiums be paid for by them and it seems also fair that our young people, who you know they are targeting, will get some benefit by being able to play sports,” DeWine said.

Changes to higher education admissions, funding

DeWine proposed a new direct admission program for Ohio public universities where students in the top 5% of their graduating high school class would have guaranteed admission.

He also proposed considering whether a college’s graduates are employed as a factor in the state funding the school receives.

The budget proposal includes the Governor’s Merit Scholarship Program which provides $5,000 each year for a student in the top 5% of their graduating class if they choose to attend an Ohio college. DeWine said there were 6,200 eligible students in the class of 2024 and three-fourths of those students chose to go to college in Ohio, an increase of 1,000 students from before the scholarship program began.

Other priorities

The budget proposal would use $50 million over the next two years to create a program called OhioSEE for students in kindergarten through third grade who need eye exams and glasses.
DeWine also wants to expand the number of school based health centers.
DeWine wants to double Ohio’s historic rehabilitation tax credit and create a new historic rehabilitation tax credit for owner-occupied buildings to help residents preserve historic homes.
The budget proposal also includes continued funding for the H2Ohio program to reduce farm runoff into water sources.
The proposed budget increases state funding for local governments and public libraries.

The state budget will be in effect from July 1, 2026 until June 30, 2027. In the next six months, lawmakers will decide appropriations for state agencies, the Legislature and the courts.

DeWine must sign a budget bill by the end of June.

Erin Glynn is a reporter for the USA TODAY Network Ohio Bureau, which serves the Columbus Dispatch, Cincinnati Enquirer, Akron Beacon Journal and 18 other affiliated news organizations across Ohio.