“Inevitable” Gambling Expansion in Massachusetts?

Massachusetts is the most recent in a long line of states to consider increasing gambling revenue (casino taxes and implicit lottery taxes) to fill state coffers.

From an Associated Press article titled “State Auditor says casino gambling in Mass. may be inevitable“:

The state’s auditor is the latest high-ranking official to get behind the idea of expanded gambling in Massachusetts.

Joe DeNucci tells the Boston Herald that he thinks the state should move ahead immediately with allowing slot machines at Massachusetts racetracks.

He also predicts a full-scale casino will be up and running here in the next three to five years.

The auditor says without slots the racetracks will not survive.

Recently state officials have also been considering selling the lottery, a proposal that is not without problems, but would be a better option than casinos and slots at racetracks.

State-run gambling enterprises such as lotteries and video lottery terminals at racetracks exemplify poor tax policy for several reasons: they are a regressive form of taxation, they are not economically neutral (they impose a higher tax rate on some goods than on others), they lack transparency (that is, the revenue they generate is not labeled tax revenue by the government), and government simply should not be involved in the gambling business.

Taxing privately run casinos is another matter and does not pose the same policy problems, although casino taxes are very complex and not neutral–they are higher than state sales taxes.

Click here for more on lottery and gambling taxes.