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Lotteries may gamble on Internet

Insider BuzzInsider Buzz: Lotteries may gamble on Internet

Several states are considering selling lottery tickets on the Internet, a change that could usher in a new era in how such tickets are purchased.

Online lottery sales would be limited to residents within the state. But Internet lottery sales are expected to spread quickly to other states if the practice proves popular, advocates of the idea say.

"Every state is looking at it," says Georgia state Rep. Terry Barnard, a Republican whose bill authorizing Internet sales passed the Georgia House of Representatives last month. The Senate adjourned before taking action.

State officials hope the Internet will boost lottery sales, which have been sluggish in some states because of competition from casinos and Internet gambling.

"The bottom line is: It will make more money and help school funding," says Illinois state Sen. John Cullerton, a Democrat. The Illinois Senate approved online sales April 14 and sent the bill to the House.

"I've said for 10 years that Internet lottery sales are just around the corner, and I may finally be proved right," says Charles Strutt, executive director of the Multi-State Lottery Association, which runs the Powerball lottery.

Internet sales are "the next logical step to make life easier for our players," says Rick Wiser, executive director of New Hampshire lottery, which was the nation's first when it began in 1964.

Forty states and Washington, D.C., have lotteries. Oklahoma will start one in October and is looking at online sales. North Carolina also is considering a lottery.

Lottery sales were $49.4 billion in 2004, according to the North American Association of State and Provincial Lotteries. Once prizes and administrative costs were paid, $15.1 billion was left in revenue for states. Throughout the USA, 64% of lottery profits go to education funding, the association says.

Internet sales have drawn opposition from gambling opponents. "My biggest concern is that teens could get lottery tickets and start gambling online," says Guy Clark, chairman of the National Coalition Against Legalized Gambling.

Internet lottery sales will expand a bad public policy that hits hardest on the poor, who spend a greater portion of their income on tickets than the affluent, says Alicia Hansen of the Tax Foundation, which studies tax policy. "If one state starts, other states will follow because legislators feel they have to compete to get all the revenue they can," she says.

Cullerton says Internet sales would bring more affluent families to the lottery, reducing states' dependence on the poor to drive sales. "This is no more an expansion of gambling than putting a new lottery terminal in a convenience store," he says.

Legislators are placing tight restrictions on Internet lottery sales. Georgia would limit sales to $5 per day and not allow credit card purchases. Debit cards could be used. A buyer would have to open an account and show identification in a convenience store before purchasing tickets online.

Cullerton says teenagers and out-of-state residents can be kept from playing the lottery by requiring identification to open an account.

USA Today

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29 comments. Last comment 12 years ago by Maverick.
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whodeani's avatar - lightening

United States
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October 9, 2003
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Posted: April 22, 2005, 12:16 pm - IP Logged

I don' see why a state would limit internet ticket sales to state residents. If the idea is to bring more revenue to the state, then why not include everybody? States don't exclude non-residents from attending a state university the only difference is tuition is more for a non-resident. I say have the internet sales open to everyone. If lotteries want to exlcude non-residents from playing the lottery, well then maybe there should be a photo ID requirement to buy tickets to show you are a resident. If it is ok to buy tickets at a lottery terminal and be a non-resident, then it should be OK to do the same on the internet.

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    good ol' georgia
    United States
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    April 17, 2005
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    Posted: April 22, 2005, 12:25 pm - IP Logged

    good point whodeani...i agree 100%....i mean there are times when i want to take a stab at the powerball....internet lotteries should not exclude non residents!

      twisted's avatar - underground
      New Jersey
      United States
      Member #2376
      September 25, 2003
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      Posted: April 22, 2005, 1:02 pm - IP Logged
      Quote: Originally posted by whodeani on April 22, 2005

      I don' see why a state would limit internet ticket sales to state residents. If the idea is to bring more revenue to the state, then why not include everybody? States don't exclude non-residents from attending a state university the only difference is tuition is more for a non-resident. I say have the internet sales open to everyone. If lotteries want to exlcude non-residents from playing the lottery, well then maybe there should be a photo ID requirement to buy tickets to show you are a resident. If it is ok to buy tickets at a lottery terminal and be a non-resident, then it should be OK to do the same on the internet.




      I think the reason why they are restricting internet ticket sales to state residents is obvious.



      The main reason why they want to sell lottery tickets online is to appeal to those "tech-savy" players who otherwise dont play the lottery. They dont want to loose the money from these potential players who because of a lack of options, spend their money on other online gambling websites. If they would allow out-of-state players to play online then people from smaller states would start playing the lottery in larger states like California or Florida who offer larger lottery games. These smaller states would start loosing valuable lottery revenue to larger states.



      Also, people who normally dont cross borders (if they reside in a Powerball state) to play Mega Millions when the jackpot is large, will be able to easily buy Mega Millions tickets from their home computers. This will eat into in-state lottery revenue of the state they reside in and Powerball would loose money also.



      I would also like to be able to play any state's lottery online. But I understand why they cant and wont do that anytime soon. Hopefully, in the future (probably distant future), we will be able to play the lottery online from around the world.
        Avatar
        MA
        United States
        Member #11452
        February 14, 2005
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        Posted: April 22, 2005, 2:11 pm - IP Logged

        The reason masslottery.com cites for not having internet sales is the Wire Act. The Interstate Wagering Amendment of 1994 could also prove troublesome.

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          FLORIDA
          United States
          Member #5364
          July 1, 2004
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          Posted: April 22, 2005, 2:21 pm - IP Logged

          I was under the impression that most state lottery's were leary of intrastate lottery purchases online due to the Wire Communications Act of 1961, which prohibits the use of wire communication facilities (telephone lines) for interstate or foreign gambling purposes.

            LOTTOMIKE's avatar - cash money.jpg
            Tennessee
            United States
            Member #7853
            October 15, 2004
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            Posted: April 22, 2005, 4:38 pm - IP Logged

            its strange how they try to pass laws that break other laws already in affect......

              wreakshavok777's avatar - enzyte thumb.jpg
              oklahoma
              United States
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              March 10, 2005
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              Posted: April 23, 2005, 2:26 am - IP Logged

              Here Is Something to chew on, Internet Lottery Ticket Sales is Already Possible  Just Make  it Legal So the cost of shipping will be cheaper. As with anything When There is a Demand... There will always be a Supply!

               Winner Winner Chicken Dinner!!

                LOTTOMIKE's avatar - cash money.jpg
                Tennessee
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                October 15, 2004
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                Posted: April 23, 2005, 2:33 am - IP Logged

                true......

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                  Cape TOwn
                  South Africa
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                  October 20, 2004
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                  Posted: April 25, 2005, 7:29 am - IP Logged

                  there are sites which offer the sales of mega millions and power ball online???? is this legal or ilegal???? cause from what i see its most definately illegal???? I went to one site and they said it was legal, so whose lieing and whose telling the truth?? please help, i don't want to purchase and pay for a ticket which in the end I know if i win i will not receive the funds as it is illegal!

                  34 15 32 12 46 47

                    Todd's avatar - Cylon 2.gif
                    Chief Bottle Washer
                    New Jersey
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                    May 31, 2000
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                    Posted: April 25, 2005, 7:44 am - IP Logged
                    Quote: Originally posted by lola23 on April 25, 2005


                    there are sites which offer the sales of mega millions and power ball online???? is this legal or ilegal???? cause from what i see its most definately illegal???? I went to one site and they said it was legal, so whose lieing and whose telling the truth?? please help, i don't want to purchase and pay for a ticket which in the end I know if i win i will not receive the funds as it is illegal!



                    lola23,

                    The problem is not the legality of playing online, because there have been court cases is which someone playing online has won, and the court ruled that they can legally collect the jackpot prize.

                    That's not the problem.  The problem is the number of scam sites out there, and sites run by one guy out of his garage.  In order to truly figure out whether a site is legit or not, it takes more investigation that one person can normally do.  That is why I'm currently looking at all the companies and web sites out there that do business online, in order to come up with a recommendation (or multiple recommendations) for people to trust for their ticket purchases.

                    I'm hoping to be able to make a recommendation sometime in May or June, so if at all possible, I'd recommend holding off until then.

                     

                    Check the State Lottery Report Card
                    What grade did your lottery earn?

                     

                    Sign the Petition for True Lottery Drawings
                    Help eliminate computerized drawings!

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                      Cape TOwn
                      South Africa
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                      October 20, 2004
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                      Posted: April 25, 2005, 8:06 am - IP Logged

                      Thanks for the info Todd.. I thought my suspecisions where right... you probably saved me a ton of money, so THANKS!! I'll stick to what I trust.

                      34 15 32 12 46 47

                        SirMetro's avatar - center
                        East of Atlanta
                        United States
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                        August 11, 2004
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                        Posted: April 25, 2005, 8:32 am - IP Logged

                        Just my thoughts, but a popular reason why most states prefer to restrict sales of tickets to residents of that state is from a tax liability standpoint.

                        Amazingly, the states do not get along well enough to ensure each other of revenue collections for monies that may belong to one state or another. For example, if you noticed with some mail order catelogs, they do not always collect sales tax for each and every state. Due to prearranged agreements with each state revenue agency, some states assist in aggressively persueing the taxes for items sold in their states more then others. A good case in point is, I could buy a product and have it shipped to GA from AL. GA wants their sales tax and enforces collection. On the other hand, if I ship from GA to AL, AL could care less.

                        All said and done, the big issue is tax collection. And simply put, Washington DC could not enforce collection of taxes onto the citizens of GA for monies won on it's lotteries and vice versa. In the end, only the IRS will benefit and if the campaign for a consumption based tax system go into effect for the federal government, the states stand to lose 30% or more of the revenue generated by the Lotteries due to the inability to collect taxes across state lines.

                        In the end, like it or not, state lotteries must be successfull in order to continue. A severe cut into revenues destroy the basis of having a lottery in the first place. So if you wish to see the lotteries continue, then you will have to accept that they must do what is required to survive.

                        This is nothing more or less then the opinion of me, myself and I and they haven't institutionalized me yet (I can still out run em).

                        Sir Metro

                        I don't mind paying taxes, I simply object to paying more then what I received.

                          Todd's avatar - Cylon 2.gif
                          Chief Bottle Washer
                          New Jersey
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                          Posted: April 25, 2005, 8:55 am - IP Logged

                          Very good points Sir Metro, I think you're right on target.

                           

                          Check the State Lottery Report Card
                          What grade did your lottery earn?

                           

                          Sign the Petition for True Lottery Drawings
                          Help eliminate computerized drawings!

                            Maverick's avatar - yinyang
                            USA
                            United States
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                            October 29, 2004
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                            Posted: April 25, 2005, 4:45 pm - IP Logged

                            Lotteries may gamble on Internet

                            I support that idea.