NASHVILLE, Tenn. (BP)--State-run lotteries are a regressive tax that disproportionately burden poor Americans, a new study by the Tax Foundation asserts.
The 40-page report by the Washington, D.C.-based nonpartisan organization argues that lotteries fail the test "of sound tax policy" and allow legislators "to increase spending while claiming credit for keeping taxes low." However, the July 3 report says, lotteries indeed are a form of tax collecting -- just as are taxes on other voluntarily purchased goods such as alcohol and tobacco. In fiscal year 2005, the report says, an average of 30.1 percent of every dollar spent on lottery games was kept by states to fund various projects -- whether it be education, parks and recreation projects or simply placing the money in the general fund.
"The only difference between the lottery tax and sales or excise taxes [on alcohol, tobacco and other goods] is...