Description
Philadelphia residents won nearly $370.5 million from the Pennsylvania Lottery in Fiscal Year 2022-23 (latest year publicly available). However, those winnings came with federal, state, and local tax obligations. One such local tax is the School Income Tax (SIT), a 3.75% tax that is applied to all unearned income, including dividends, royalties, and gambling winnings. The tax revenue goes entirely to the School District of Philadelphia.
If every Philadelphia lottery winner properly reported their SIT, the School District of Philadelphia would have received $14 million in revenue for Fiscal Year 2023 ($54.5 million actual amount FY23). From Fiscal Year 2013 through 2023, Philadelphia’s lottery winners should have contributed $135 million in SIT through their earnings ($3.5 billion won).
In addition to earnings paid to individual lottery winners, the Pennsylvania Lottery supports many programs primarily for older adults. In Fiscal Year 2023, the lottery generated $1.2 billion, with more than $300 million, or 25%, of the total funds returning to Philadelphia through programs that include:
- Care services – supports long-term care, care facilities, and related services for older Philadelphians.
- Shared and free-ride transportation programs – helps seniors access affordable transit options, like SEPTA’s Senior Fare program.
- Philadelphia Corporation for Aging (PCA) and senior centers – essential services are provided through PCA, the city’s Area Agency on Aging, as well as centers across the city.
- Property tax and rent rebates – available to eligible Philadelphians, with applications open until June 2025.
- PACE/PACENET pharmaceutical assistance – helping seniors afford prescription medications.
The chart below breaks down how that $302.7 million in lottery-funded benefits are distributed across Philadelphia.
Source: Philadelphia County Beneficiaries
Each month Controller Brady looks forward to bringing transparency and accountability of our city, right to you.