How Much Does the Lottery Contribute to State Budgets?


In 2021, Americans spent $100 billion on lottery tickets. It’s the largest form of gambling in the United States, and a big reason why states promote it is as a way to raise revenue for schools, roads, and public services. But how much it actually contributes to state budgets is debatable, as is whether the benefits outweigh the costs.

It’s also a big way to fund social services. Lottery players pay for the chance to win a prize by buying a ticket with numbers that are drawn at random. They may be eligible for subsidized housing units, kindergarten placements, or the grand prize of a new car.

Some people play because they think it’s their last, best, or only chance to change their lives for the better. Others do so for a more practical reason: to make a quick fortune. The HuffPost reports on a couple who made millions by bulk-buying thousands of lottery tickets and then traveling to various cities to play them.

But even if you buy a ticket, you’re not guaranteed to win. You’ll still have to pay taxes if you do, and that can take a significant chunk of any winnings. If you won a jackpot of $10 million, for example, you’d only have about half that after federal and state taxes. That’s because lottery commissions collect more money from ticket sales than they pay out in prizes. That’s how they can afford to run the game.