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Lottery is a new tax on false hope

The North American Association of State and Provincial Lotteries boasts that 27 cents of every $1 spent on lottery tickets goes back to the government. This payment is not to be confused with taxes generated from winnings. In other words, state-run lotteries impose a 27 percent tax on the mere act of purchasing a lottery ticket.

It is irrelevant that buying the ticket is voluntary. Taxes are imposed on all sorts of voluntary activities, ranging from using a phone to going to the movies. What is unique about a lottery is that it is a state-run monopoly on a nonessential service — very different from natural monopolies, like water and electricity provision, with high startup costs. The purpose of the lottery monopoly is not to provide for a public need or to protect the public welfare, but to generate revenue. It’s a tax.

Moreover, the lottery is a bad tax. It’s inefficient, with much higher administrative costs than other forms of taxation, and it encourages nonproductive, if not downright destructive, behavior.

Jameson Taylor
Clarion Ledger

Posted May 21, 2017 - 10:27 am

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