A Bermuda lottery would be a tax on the poor, the executive director of the Casino Gaming Commission warned yesterday.

Richard Schuetz said a lottery would not benefit the community.

He added: “Lotteries have historically been called a tax on the poor. They are known as a regressive tax.

“Jurisdictions use them to raise money, and they raise it on the backs of the poor. I don’t get that as a public policy goal.”

Mr Schuetz was speaking after Zane DeSilva said the new Government planned to create a lottery to support sports funding and education.

But Mr Schuetz said: “What I heard during the election is there is a problem with people being poor, so lets not exploit the poor to deal with this debt.”

Mr DeSilva told ZBM News earlier this week that he backed the introduction of a lottery and explained that, if implemented correctly, lotteries and casinos could generate government revenue to fund sport across the island.

He told the station: “I think that if we use gaming correctly, if we set it up correctly, whether it’s gaming, a lotto or what have you, I believe if we set it up correctly we can use the surplus of funds that are expected to put into our community, whether its education or sports.”

The Progressive Labour Party’s election platform called for the introduction of a local lottery to benefit sports development and national sporting bodies within two years.

Mr DeSilva said: “That is going to be very much on our agenda.

“I think that between gaming and lottery, if it’s done correctly, I think we can generate quite a bit of extra revenue for the government.”

A 2010 Government-commissioned study by the Innovation Group estimated that a lottery could generate more than $17 million a year in revenue.

It said that the introduction of lotteries are often “politically motivated”, aimed at raising funds for programmes to improve the quality of life of citizens.

But Mr Schuetz raised several concerns about legalised lotteries.

He said: “In tax language a lottery is known as a regressive tax, meaning that it takes a larger percentage from lower income people.

“Furthermore, empirical studies have demonstrated that lottery sales increase during the times of the week or month when transfer payments are made.

“A classic example of a transfer payment is welfare.”

Mr Schuetz added that lotteries serve as competition for casinos while creating comparatively few jobs and that the introduction of a lottery could translate to fewer casino jobs.

Asked why lotteries would be viewed as regressive tax and casinos not, he said the cost of entry was a key point.

Mr Schuetz added: “You can get into the lottery for a fairly low price generally.

“Even when they raise the price of entry, you get these syndicates in the neighbourhood to buy tickets, so raising the price doesn’t work.

“People don’t go into a casino and bet a dollar.”

He also said the casino model being adopted on the island was intended to increase investment and employment and boost tourism.

Mr Schuetz added: “A lottery is not going to do that. This is a small island. It’s not like you are going to get those jumbo jackpots.”

He explained that lotteries need liquidity to survive and that Bermuda’s size would cause problems.

Mr Schuetz said: “Bermuda has a very small population. This means that the jackpots would be very low and the administrative costs would be quite high as a percentage of revenues.”

Mr Schuetz also said he had discussed the topic with Roger Trott, the Commission’s director for problem and responsible gaming, who said that lotteries could present a high level of risk for problem gamers and poorer participants.

Government did not respond to requests for comment by press time last night.