A player just reached out to us with a question about a fee she paid to buy lottery tickets at a store in her area. We were able to help resolve that situation, and I’m sharing the details here in case you’ve ever experienced the same thing.
The woman bought lottery tickets at an Iowa store and thought she’d been charged sales tax on the purchase. She wanted to know if that was something new.
We reached out to the store involved and learned that it had mistakenly been charging a processing fee to players who used a debit card to buy lottery tickets. We let the store know that fees like that can’t be passed along to the player for a lottery purchase.
Iowa Lottery tickets are sold at the price printed on the ticket. So even if you buy multiple tickets, the total amount of your purchase will always end in 0.
Sales tax doesn’t apply to lottery tickets, and processing and service fees also can’t be charged to a player for a lottery purchase.
The reality of those requirements means that some stores may not accept debit cards for lottery purchases, and that is their decision to make.
In Iowa, it’s legal for a customer to use cash or the equivalent (including gift cards, debit cards, and checks) to buy Iowa Lottery tickets. Any of those methods use available funds for the purchase, so they are permitted. But it is illegal in Iowa for lottery tickets to be purchased with a credit card.
While a lottery retail location can accept a debit card for the payment of lottery tickets, they are not required to do so. Card transactions for retail purchases involve processing fees (sometimes called swipe fees) that the merchant has to pay. Some retail locations limit card transactions to also limit the processing fees they pay.
The bottom line: You should never pay any sort of fee to buy lottery tickets in Iowa. If a retailer is charging you one, let us know so we can help.
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