Lotteries in Russia: results of four years of monopoly

In most European countries lotteries are controlled by the state: state authorities act as operators or give licenses and control private companies. This measure is designed to protect players, ensure an honest game procedure and winnings payment. Russia joined this practice in 2014.

Who prints tickets?

Today, lotteries in Russia are only state-owned. They are organized by two authorities:

• Ministry of Sports of the Russian Federation (Russian Lotto, Housing Lottery);
• Ministry of Finance of the Russian Federation (Win with us, KENO-Sportloto).

Gosloto and Russian Lotto are brands owned by the Ministry of Finance. State Sports Lotteries JSC and Sportloto LLC are approved contractors. The Stoloto trading house is the only ticket distributor, which also pays the winnings. The points of sales of Stoloto are located in all cities of Russia.

Lottery procedure in Russia

1. The Ministry of Sports of the Russian Federation or the Ministry of Finance of the Russian Federation concludes an agreement with the operator; examines and approves the rules of the lottery developed by the operator.

2. The operator (State Sports Lotteries JSC or Sportloto LLC) holds a lottery.

3. Stoloto ensures distribution of tickets and payment of winnings. According to the law, at least 50% of the cost of each ticket is sent to the prize fund.

There is no legal private lottery business in Russia, since there is a monopoly for carrying out lotteries. In support of the ban on private lotteries, it was said that the state guarantees the fair process and the receipt of winnings; deductions from the lottery are used to finance state programs. But in fact, control is not strong enough, and processes are not transparent. A detailed ‘exposure’ of Stoloto was published by Moskovsky Komsomolets.

Market volume and history of large winnings

Despite all the disadvantages of the existing system, lottery business in Russia is a multimillion-dollar industry that grows year by year. For instance, in 2016, the number of tickets distributed through the Russian Post increased by 46% (to 39.6 million pcs.). And Gosloto earned 1.8 billion rubles only for the first half of 2017.

According to the statistics of Stoloto, 76% of participants win today in state lotteries. Every day the company pays about 200,000 winnings of different amount. Every week, about 15 winnings, equivalent to 1 million rubles or more, are paid out.

Here are a few stories that happened in recent months:

• On February 16, a resident of Ufa guessed five numbers and won more than 26 million rubles in the lottery. The prize was drawn in one of the draws of ‘Gosloto 5 out of 36’.
• 26 people won prizes worth millions in the New Year's drawing on tickets distributed through the Russian Post. The drawing was held on January 1. The press service of the Post notes that the drawing of the previous year resulted only in seven winners.
• On March 1, 2018, a resident of Nizhny Novgorod won 267 million rubles. According to the lucky player, he developed his system of determining the winning combination.

What has changed in the new year?

Since 2018, only 18-year-old citizens can participate in Russian state lotteries, and the winnings are paid only after showing a passport.

The taxation of winnings has also changed. Amounts that are less than 4 thousand rubles are declared only if winners wish to; tax on the amount of more than 15 thousand rubles is withheld and paid by the lottery operator, and is the sum of winning is from 4 thousand to 15 thousand rubles, citizens pay taxes themselves.

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