The reliance on lottery income means states have to continually fight to maintain bettors’ interest with new games and new ways to win.
In West Virginia, the lottery’s revenue decreased 2.6 percent in 2016, in Rhode Island revenue was down 3.2 percent in 2016 and in Missouri revenue was down 3.3 percent in 2015. Officials in many other states are also facing similar numbers, The Pew Cheritable Trusts website reported.
According to the analysis made by the newspaper, the "Jackpot Fatigue" - a drop off in lottery play until jackpots get unusually huge- may be the cause of the low income generated by the sector over the past years. The report also pointed out that the "explosive growth" of casino industry, particularly in states such as West Virginia, Pennsylvania and Meryland has hurt some lotteries.
David Brunori, a professor of public policy at George Washington University who has written about state tax policy, blames jackpot fatigue and new gambling opportunities for the downturn, and said states are turning to more sophisticated advertising campaigns to keep interest up. If the ads weren’t running constantly, lottery revenue would be even lower, he said.
Brunori noted that revenue in the 44 states that have lotteries was about $21.4 billion in 2015. That’s not a huge amount compared to the $2.2 trillion states raised by all methods in 2015, but “it’s $21 billion in taxes they don’t have to impose on people, and that’s 99 percent” of the reason they do it, he said.