Study calls lotteries a tax on the poor

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WASHINGTON, D.C. — State lotteries are a hidden and unfair tax on the poor, according to a study from the Tax Foundation.

The report also found the money isn't going where promised and costs states a bundle in social services to take care of problem gamblers.

For example, Virginia officials boast that the state gets $432 million a year in lottery proceeds. As in most of the 42 states with the games, the money is said to be earmarked for schools. But, Chris Friend of The Family Foundation in Virginia said that's not the entire balance sheet.

"At the end of the day, what amounts basically to a couple of hundred dollars per kid," he said, "is probably costing far more than that in broken families and in broken homes."

And Alicia Hansen, the report's author, said while lawmakers like to say the proceeds go toward education, what they don't explain is that other funds are taken away.

"They know that the lottery revenue is coming in, they know it's earmarked for education and they're counting on that money," she explained. "So then, they can take the money that they would have otherwise spent on education, and they can spend it on other things."

Chad Hills, gambling analyst at Focus on the Family Action, said that's a standard scenario for the gambling industry.

"They get a foothold in states by making a bunch of promises," he said, "then once they get their foot in those states, those promises are seldom fulfilled."