Last week I wrote about the proposal to repeal the Massachusetts income tax. I believe that the Massachusetts income tax should not be repealed, because we need the revenue, and it is the right kind of tax.
We ought to repeal the Massachusetts Lottery. We certainly can use the revenue, but it is the wrong kind of tax.
The Massachusetts Lottery is not widely regarded as a tax, but that is exactly what it is. A tax is a burden imposed upon the citizens by the state to meet state revenue needs.
While taxpayers are not obliged to "play" the Massachusetts Lottery, they are constantly urged by the state government to do so. In 2007 the citizens of Massachusetts spent $4,700,000,000 (that is 4.7 billion) dollars on The Lottery. The lottery ticket sales added up to a total of $699 for each of the 6.34 million persons living in Massachusetts.
In my view, a tax ought to be fair, transparent, and obvious. The Massachusetts Lottery is none of these.
A fair tax should be imposed on all taxpayers at the same rate, or it should be progressive - laying a heavier burden on those taxpayers who are more able to pay. The Massachusetts Lottery is in fact regressive, since taxpayers of lesser means "play" the Massachusetts Lottery - wealthier taxpayers do not.
It is important that a tax be transparent and obvious. The Massachusetts Lottery is not.
If you prepare an income tax return once a year, you will look at the amount that you pay in taxes. You will be aware of the burden you are carrying. This awareness will give you some incentive to look at what your tax money is being spent on, and question whether those expenditures are wise.
A casual outlay of thirty or forty dollars per week to buy lottery tickets does not create the pain, and the awareness, that a one-time preparation and filing of an income tax return will create. Thus, in my view, it is not a fair tax.
I do not believe that the Massachusetts Lottery will be repealed any time soon. However, I would ask that, when you think about reducing or eliminating any Massachusetts tax, you take a close look at the Massachusetts Lottery.
Notes to Our Friends is provided by Haddleton & Associates, a law firm specializing in estate planning, probate, taxation, veterans' benefits, and elder law.
- Russell E. Haddleton
