9 States with No Income Tax - NHL CAP

[Hockey Outsider]

And after all that for the income taxes, you'd have to figure out sales and property taxes too. It isn't a coincidence Texas has some of the highest property taxes or Tennessee some of the highest sales taxes. Why shouldn't that be factored in? It's not hundreds of thousands in fees, it's millions and it's recurring.

Playing devil's advocate, the best, most reasonable, idea I can come up with is a cost of living multiplier that's attached to each contract that is considered after-cap. That multiplier would be a schedule released annually. But even that would require some considerable compliance cost and (I'm sure) endless arguing. And in the end, as you said, the value isn't worth the cost. I doubt this is an issue the owners are even considering.

I agree. Once you open Pandora's box and start trying to equalize income taxes - why not look at sales taxes and property taxes as well? Why would you adjust for one type of tax, but not the other (especially because there's often a trade-off between the various kinds?) This would only add to the complexity.

The point of the salary cap is cost certainty for the owners. Full stop. As business owners, they don't care how the $80-something million dollars gets allocated between the IRS/CRA and the players themselves.

It's inconceivable that the owners would want to spent hundreds of thousands of dollars annually for an army of lawyers and accountants to do these calculations, when it doesn't in any way effect their objective of cost certainty.

 

[DudeWhereIsMakar]

Does the proposal include the difference on the Canadian dollar.

I wouldn't say so because I think it should be based on whichever is dominant and they get paid in whichever dollar that happens to be. Which is how it currently is.

 

[Three On Zero]

This explains why the Panthers have been a constant contender since entering the league!!

 

[NYSPORTS]

And the Rangers and Kings have an advantage over the rest of the teams in the league because they attract the most free agents. Let’s do something about that too.

EDIT: Apparently Kings don’t have this advantage like I assumed. Apologies to kings fans.

well, we’re (NYR) just historically stupid with money so

 

[Legion34]

The salary cap was implemented to achieve "cost certainty" for the league. Based on the overall financial health of the league and the steadily increasing revenue, it has not been a failure in any way.

Again there is no need for all teams to have equal cap then. 50% goes to the players. There is no reason under cost certainty that all teams spend the same.

Just like a team has an 81.5 million cap. There is nothing that says all 23 players get the same money.

the league gets to spend 50% of HRR. There is no reason based on cost certainty that the league has to allow each team to spend the same

 

[Legion34]

I agree. Once you open Pandora's box and start trying to equalize income taxes - why not look at sales taxes and property taxes as well? Why would you adjust for one type of tax, but not the other (especially because there's often a trade-off between the various kinds?) This would only add to the complexity.

The point of the salary cap is cost certainty for the owners. Full stop. As business owners, they don't care how the $80-something million dollars gets allocated between the IRS/CRA and the players themselves.

It's inconceivable that the owners would want to spent hundreds of thousands of dollars annually for an army of lawyers and accountants to do these calculations, when it doesn't in any way effect their objective of cost certainty.

if the cap is cost certainty for the owners. Full
Stop. Then let some teams pay more. Than others. There is nothing in cost certainty that says each team should get the same max cap

 

[Three On Zero]

Edmonton has lesser taxes than Vancouver, what’s the league going to do about that?
This is out of the leagues control and will NEVER be dealt with fairly that everyone is happy with.

 

[tucker3434]

if the cap is cost certainty for the owners. Full
Stop. Then let some teams pay more. Than others. There is nothing in cost certainty that says each team should get the same max cap

His point is that the owners aren't asking for this. They don't want to pay more. They like money.

 

[NYSPORTS]

The salary cap was never about fairness. Allowing teams with higher income tax to spend more is the opposite of what the league would want.

NHL had to do something. If not for the salary cap the Rangers would buy everybody. The league had to impose a rule years ago that stars sub 30 years of age signed away from a team the recipient would owe five #1 picks. The Rangers did make an offer for Sakic which was matched by the Avs.

in the early 2000’s the Rangers payroll was high 70’s and that’s without signing young players away from other teams. They could have easily become the Yankees and bought everybody.

 

[Hobble]

Every city should also restrict professional hockey players to lower bandwidth WiFi.

 

[Lazlo Hollyfeld]

Every city should also restrict professional hockey players to lower bandwidth WiFi.

or certain hfboards members who keep whining about state taxes.

 

[McVechkin]

The difference is likely not as big as you would assume. These states need to get money somehow so they likely have different taxes that are higher than the states with income taxes (property, sales, etc)

 

[wetcoast]

Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming — have no income taxes "state".

Kraken, Knights, Panthers, and the Lightning.

Each of these teams have a clear advantage over the rest of the league. Each of these teams work within CAP framework plus added room when one factor's tax break to negotiate contracts.

Is this something the NHL will consider next collective agreement?

It's also a lot cheaper to live in Edmonton or Winnipeg than Seattle or Washington.

I really wonder how much state income tax factors into where free agents actually end up signing?

 

[Lolonegoal]

This has been beaten to death.

Vote for better elected officials that won’t take money you worked for.

I'll vote officials who take larger percentages from millionaires over lower and middle class, sure.

 

[I Hate Blake Coleman]

The next CBA needs to lessen the tax burden on these millionaire players and billionaire owners.

 

[ScaredStreit]

Do we account for the amount of income tax each state has, since not all states/provinces that have it are the same rate? Do we adjust the Canadian dollar to make room for it. If rates change...do we change player's cap hits? What if they're traded? Does a player with a $7million cap hit on Florida get a lower hit if they're traded to say Buffalo?

Why do we only factor in on income tax? What about cost of living or property tax?

There's no perfect solution to any of the above. Every market is going to have its advantages and disadvantages-get over it.

 

[MoneyManny]

It's so simple! Now, how do you implement it?

Not sure if an employer could force it's employees to show them their taxes, but i could see it working with a more dynamic cap system like in the NFL where unused cap space rolls over to the next season giving team accountants some breathing room to do their job.

Honestly though it's a terrible and complicated idea that wouldn't bring in any additional revenue to the NHL and barely any entertainment value to the fans.

 

[MBH]

This has been beaten to death.

Vote for better elected officials that won’t take money you worked for.

Vote for elected officials who serve the millionaire class over the working and small business class.

End of the day, whether or not some player stays in Tampa for less $$ matters less to me than living in somewhere that takes care of the sick and the old.

 

[Hockey Outsider]

if the cap is cost certainty for the owners. Full
Stop. Then let some teams pay more. Than others. There is nothing in cost certainty that says each team should get the same max cap

That's true. In theory, the league could give one team a $90M cap and another team a $75M cap (as long as leaguewide salaries = 50% of revenue as defined in the CBA). Here are four reasons that isn't going to happen:

1. Wasteful spending - As I mentioned in my previous post, the calculation of a player's after-tax earnings is far more complex than many people realize. It would require thousands of hours of lawyer/accountant time each year to deal with this. The annual fee would be at least several hundred thousand dollars - possibly over a million. The owners would be throwing money away over a problem that nobody (aside from a few fans on message boards) seem to care about.
2. Bad optics - A small number of passionate fans might understand why the salary cap varies on a team by team basis. But casual fans would struggle to understand why their team has a lower cap than another (especially when no other sports league in North America does that). Optics count, and this would create the impression that there isn't a level playing field.
3. Difficulty of implementation - Compliance with the salary cap is already challenging enough when there's one number that applies to everyone. This adds an unnecessary level of complexity. Mid-season trades would be particularly challenging to deal with. Why would teams voluntarily agree to make it more difficult for their GM's to do their job?
4. Futility of negotiation - If it's true that some teams have a disadvantage, that also means that some teams have an advantage. This is a competitive business. Teams that have an advantage based on the current system aren't going to agree to give it up due to an appeal to "fairness". To the extent that an advantage actually exists, any negotiation would be doomed from the start as the teams owners that benefit from the current system would insist on the status quo. You'd never get enough owners on board to implement this change.

I agree that there are small differences in the effective after-tax cap between different teams. But it's one of a multitude of factors (cost of living, weather, sponsorship opportunities, quality of schools, etc) that realistically can't be adjusted for. It's a completely impractical suggestion, which is probably why we haven't seen this in the MLB, NFL or NBA either.

 

[tarheelhockey]

if the cap is cost certainty for the owners. Full
Stop. Then let some teams pay more. Than others.

They already do let some teams pay more than others. There is a ceiling and a basement. Teams choose what floor they want to be on.

If you’re arguing there should be a wildly higher ceiling, then there must also be a wildly lower basement. At that point, I do believe you have missed the whole notion of “cost certainty”.

 

[DuckyGirard]

This has been beaten to death.

Vote for better elected officials that won’t take money you worked for.

So wait, I'm now in the same tax category as someone making 6 mill a year?

If you have a poor understanding of the tax system if you think their tax brackets and theirs look in any shape or form the same.

Maybe you enjoy subsidising Actors, Rappers and entertainers but not I. If I'm gonna be handing out tax cuts it's to business owners who actually invest in the economy.

 

[Puckstop40]

So wait, I'm now in the same tax category as someone making 6 mill a year?

If you have a poor understanding of the tax system if you think their tax brackets and theirs look in any shape or form the same.

Maybe you enjoy subsidising Actors, Rappers and entertainers but not I. If I'm gonna be handing out tax cuts it's to business owners who actually invest in the economy.

I responded to several other posts already in this thread regarding my comment. The response was tongue in cheek because this subject gets brought up every f***ing time a team located in a state with no state level income tax has success.

I’m very aware of the tax system. It has nothing to do with the success of hockey franchises.

 

[Devonator]

This is obviously not the place for political discussion, but having low taxes does not imply better elected officials.

Uh....I hope you are not daring to suggest the opposite is true that by electing tax us to death politicians is somehow good for us? We are being taxed to death here in Canada...yeah...we could use some good politicians that realize this....

However as others have pointed out through this thread, there is more to this story then just taxes...the complaining from certain teams is getting embarrassing.....

 

[tarheelhockey]

Uh....I hope you are not daring to suggest the opposite is true that by electing tax us to death politicians is somehow good for us? We are being taxed to death here in Canada...yeah...we could use some good politicians that realize this....

However as others have pointed out through this thread, there is more to this story then just taxes...the complaining from certain teams is getting embarrassing.....

I think what he’s implying is that tax policy has nothing to do with accountability. If you want good politicians, devote your energy to strengthening the institutions which hold them accountable — particularly the courts and the watchdog agencies.

 

[Devonator]

I think what he’s implying is that tax policy has nothing to do with accountability. If you want good politicians, devote your energy to strengthening the institutions which hold them accountable — particularly the courts and the watchdog agencies.

Well I hope you right but up here in Canada, far to many Canadians are in love with big government ......