The GST Council is considering a uniform rate of 28% for all lotteries, a report in The Times of India said.
At present, the goods and services tax (GST) on state lotteries is 12%, while those authorized by the state but run by private agencies are taxed at 28%.
The report also said that the Centre was looking to ban online lottery. The final decision will be taken by the home ministry.
Ten states, including Goa, Kerala, Maharashtra and Andhra Pradesh, allow lotteries.
A hike in the rate to 28 percent could hurt states like West Bengal, but many other states are in favor of an increased tariff, the report said.
Many see lotteries as a sin good and think a higher GST rate will discourage people from spending money on them.
The council will take the views of both the AG and the group of ministers, who have suggested a single rate, the report said.