The money coming from lottery tickets purchased by Indians can be used to improve infrastructure, health, education, and even help charity programs if well directed. We have investigated how different Indian states use lottery revenue to determine if the money is properly managed.
- Most Indian states incorporate the lottery revenue and use at their discretion
- Kerala and Mizoram are transparent and direct the money towards free health
- Fraud has happened but it is definitely not the rule in India
How Is Lottery Revenue Used in India?
The lottery revenue in India is directed to the government, as it comes from state lotteries. In some states, like Kerala, it is clear that they are directed towards social causes.
However, that is not always the case. The lack of transparency and even fraud that have occurred in the past show that India still has to improve the use of revenue from the lottery. Check out the information we have brought with exclusivity below.
Kerala: Welfare and Health Programs
Kerala is a success case in many ways. Besides the vast selection of lotteries, you may check on our Kerala lottery chart; other state lotteries inspire themselves in their schemes, and they are an example of transparency and social investment.
According to the state budget for 2024-25, the net profit from lottery ticket sales stood at Rs. 1,022 crore, a fraction of the total revenue of Rs. 13,244 crore.
Despite being a modest 0.5% of the state’s actual budget, that amount was well invested in social programs, as per information from the Financial Minister. For example, the Karunya Benevolent Fund receives the lottery revenue net profit, and with it, supports thousands of dialysis and chemo treatments, besides angioplasties.
In summary, this is what Kerala uses its lottery revenue for:
- Funding education and welfare, but especially health schemes
- All health causes supported by it provide free care
- The net revenue is estimated at only 0.5% of the state budget
Nagaland: Part of the Government Treasury
Our research has found a lack of archives that could help us gather information on the lottery revenue in Nagaland from recent years. We have found that the average gross revenue between 2006 and 2010 was ₹ 7.95 crore, with a result of ₹ 25.20 crore in 2022.
The worst part is that there is no data on their application of that money either, meaning that all we know is that all the money from the Nagaland Lottery goes to the government. As a result, our summary on how Nagaland spends lottery revenue is quite disappointing:
- Nagaland has managed to improve its gross lottery revenue across the years
- It is uncertain how much of the revenue remains after administrative costs
- There is no transparency on how the government uses that money
Maharashtra: Assumed Welfare Investments
There are allegations that the accrued lottery revenue in Maharashtra goes to the improvement of infrastructure, health, education, welfare of the community, and the agricultural sector. However, there is no official source of transparency to check where that money went.
Like other Indian state lotteries listed here, the yearly net income from lottery revenue is quite low in Maharashtra. For example, the year 2023-24 collected Rs. 24.43 crore in lottery sales, and only Rs. 3.52 crore remained as net income. Our summary for this state’s data is the following:
- Maharashtra informs that its revenue goes to social causes
- There is no official source indicating that specific funds were helped by the lottery income
- Only a fraction of the total revenue becomes actual net income
Mizoram: Dedication to the Free Health Care Scheme
Mizoram has managed to accrue a net lottery revenue of Rs. 10 crore in the fiscal year 2022-23, almost 28% of the gross revenue. That amount was directed to its free medical care insurance scheme, as that is the main purpose of the lottery in the state.
That is one of the best and most transparent schemes, not to mention that they do manage to direct a good portion of total sales to something important. Therefore, we can conclude that Mizoram has:
- A good management of lottery sales, achieving close to 30% in net income
- An obligatory allocation to its free care health scheme
- Successfully restarted its lottery program after the pandemic
The 5 Indian States With Unespecific Destinations
There are five other Indian states that we have come across in our investigation and have a case similar to Nagaland. In order to save your time in your own research, here is what we have found about them:
- Punjab: It has one of the highest lottery revenues in India with Rs. 247 crore, behind only Kerala, in 2021-22. However, lottery proceedings are categorized under Miscellaneous General Services, and no specific funds or schemes are mentioned.
- Sikkim: One of the Indian states to rely on lottery income for its revenue, but fails to have clear declarations on how the money funds the government’s actions.
- West Bengal: The state benefited a lot from GST and improved its lottery revenue by ten times, accruing about Rs. 200 crore, plus Rs. 2,000 crore from GST every year. Despite that impressive help, the money is simply incorporated by the state, and the current documents reveal nothing about its destination.
- Meghalaya: Although it has recently reintroduced the lottery, the state fails to provide information on its budget improvement from lottery revenue, not even expectations.
- Goa: Another state that simply does not seem to care about informing where its lottery revenue goes, having accrued about ₹43 crore in the fiscal year of 2021-22.
Arunachal Pradesh: Money Going the Wrong Way
Arunachal has faced an important setback in the lottery trust in June 2025. The Central Goods and Services Tax has uncovered tax evasion of about ₹98.43 crore. It was the lottery distributor in the state, M/s Future Gaming and Hotel Services Pvt Ltd, that hid real information on total sales to avoid taxes.
As a result, all that amount could have gone to the government to help invest in welfare. Fortunately, the investigation occurred and found the culprit.
Still, with or without almost Rs. 100 crore in the total lottery revenue, we could not know the destination of that money. Even after that case, Arunachal proceedings from the lottery remain untracked and we cannot know for sure where the money goes.
Indian States Vs. Bhutan: Which One Gives Lottery Revenue the Best Use?
Since there are people who consider playing the Bhutan lottery from India, we believe that comparing that country with our state lotteries in terms of using lottery revenue could be interesting. The table below brings information you could not have known otherwise:
| Characteristic | Indian States | Bhutan Lottery |
|---|---|---|
| Destination | Most states fail to provide documents and transparency on their destination, but Kerala and Mizoram do a great job at providing free health care | The government provides a consolidated report on its investments in all possible areas, but we cannot separate lottery income from the rest |
| Transparency | The vast majority of Indian states fail to be transparent | Not transparent when it comes to the specific destination of lottery revenue |
| Net income from lottery | Ranges from a few crores, like Maharashtra, to thousands of crores in Kerala and West Bengal (GST included) | About Nu 151.4 million in the fiscal year of 2023, which means 15 crores |
While Bhutan actually does a great job at informing its allocation of the treasure through annual documents and reports, we cannot know for sure where the lottery money goes. Like most Indian states, it is incorporated and used at their discretion.
Do We Actually Benefit From State Lottery Revenue?
We can infer that, at least in most states, people actually benefit from the lottery revenue accrued by the states. Either specifically directed to a fund or by being incorporated into the government’s budget, the money reaches the public one way or another.
Also, it is important to consider that lottery sales include revenue to lottery ticket sellers, and salaries to everyone involved in the administrative and operational part of the lottery. Therefore, we may consider that it also supports the community that way.
It is clear that a minimal part of the lottery revenue from Indian states is actually net income that can be used. It could be simply because of how lottery schemes are structured, with low ticket prices compared to prizes, or maybe there are administrative mistakes. If other states follow the example of Mizoram, we will walk towards better times.
FAQ
Most Indian states incorporate the net lottery revenue to their budget to use as they must. Only a fraction of them have a specific and transparent destination for that money.
No, not all Indian states are obligated to direct their lottery revenue to a specific cause or fund, only if their legislation states so.
The money for the lottery prizes comes from ticket sales. That gross revenue is used to pay prizes, administrative costs, and is finally incorporated by the government.
We can know by the action and investigation of public institutions that the money is not being stolen. Cases such as what occurred in Arunachal are a shame, but fortunately, an exception.
If the state government is transparent as to its use of the lottery revenue, you can find the reports at the financial department or the ministry website.
