Lottery Revenue and Per Capita State Lottery Spending

Polls suggest that the U.S. public is generally in favor of a lottery, and the profits from ticket sales are often allocated to good causes. Historically, lotteries have been around for many centuries, going back to the time of Moses, who divided the land among the Israelites. Lotteries were also used by the Roman emperors to distribute property and slaves. Lotteries were introduced to the United States by British colonists, but between 1844 and 1859, ten states banned the practice.

Polls show strong support for a lottery in the U.S.

In Georgia, 72 percent of voters said they favor a lottery, and several candidates for governor are debating how the lottery will work. The lottery proceeds will go toward education. Opponents have argued that it’s not a good state revenue source, and one state senator argued that a lottery is like a “numbers racket.” The opposition is generally couched as moral concerns, with religion playing an important role.

Per capita spending

In previous reports, LendEDU has calculated the amount of per capita lottery spending by state. Now, we can see whether the numbers are accurate. During the last fiscal year, the state lottery’s total revenue surpassed $72.7 billion, with each state’s revenue divided by its population. As the number of state lotteries continues to increase, per capita spending has jumped as well. In fact, state lottery revenue per capita has reached $225 per person in some states.

Regressivity of participation among lower-income people

In studies examining the economic consequences of increased government involvement in civic affairs, regressivity of participation among lower-income people tends to be overstated. While participation among low-income groups declines as the wealthier groups rise, the share of lower-income households spending on electricity is consistently declining. In contrast, participation among higher-income groups is highly correlated with income. The data presented here support this theory.

Taxes on lottery winnings

If you’ve won the lottery, you may be wondering about taxes on lottery winnings. Although lottery winnings aren’t taxed separately from other income, they are still taxed at a higher rate than other types of income. This gives lottery winners a lot more freedom to invest their money in business expansion or retirement accounts. If you’re wondering whether lottery winnings are taxed in your state, you should know that the tax rate is based on your adjusted gross income.