Public Policy Position on Gambling and The Lottery
Policy
After reviewing the findings of extensive studies on Gambling and Lotteries and carefully considering their implications for New Mexico, the Board of Directors (NMCC) has voted to coninue strong opposition to the state lottery and any expansion of gambling, especially Class III gambling for New Mexico for the following reasons:
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State lotteries are, in effect, a regressive form of taxation. Even though no one is forced to play the lottery, studies have shown that of those who do participate, the poor regularly gamble a higher percentage of their limited income than do other players. A national study conducted in 1976 revealed that the lottery is 2.5 to 3 times as regressive as the sales tax which is commonly cited as the classic illustration of a regressive tax, i.e. a tax which falls most heavily on those least able to pay.
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State lotteries are a minor and uncertain source of state income. By the most recent statistics (1983) state lotteries produced between 0.37% of a state's general fund revenue (Vermont) and 6.4% (Maryland). This, at best, is hardly a solution to any state's financial problems. Moreover, since lottery income is entirely dependent on the whim of those who choose to play, such income is a totally unreliable source of state governmental funding.
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State lotteries are an inefficient way to raise state revenue. A national study indicates that 60% of total lottery income, on average, goes to payment of prizes and administrative expenses of the lottery in contrast to one to two percent which it costs to collect most other taxes.
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State lotteries put the state in the position of encouraging gambling, an enterprise which it has generally been public policy to discourage. It is increasingly clear that the impact of lottery playing on large numbers of low-income households is to drive them deeper into poverty, thus leading to increasing demands on the costly social service and welfare systems of the lottery states.
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State lotteries, through strenuous advertising techniques and widespread publicity, increase the percentage of the population which participates in gambling and contribute to the growing numbers of compulsive gamblers in the nation. The U.S. Commission on "The Review of National Policy Toward Gambling" in its 1976 report found that "legalization (of gambling) may lead to unexpected and ungovernable increases in the size of the gambling clientele." Some states are finding it necessary to use part of their lottery income to fund therapy centers to deal with the growing number of compulsive gamblers.
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All gambling in essence is a parasitic drain on the economy. New Mexico, being a relatively poor state can ill afford having millions of dollars drained out of the purchase of goods and services and nestled in the hands of a few organizations or even the state itself. It is counter-productive to health economic growth.
