After Tax Salary Caps

[I am Canadian]

It's easy to dismiss this with agents navigating loop holes but to dismiss this as not an advantage is ludacris.

Next, we will have the CBA eliminating massive signing bonuses and paid travel & coaching in the offseason because God forbid a team tries to get better.

Yet tax advantages will remain.

 

[TOGuy14]

30%? Did you randomly come up with this number or you are really that bad at math?

hedman signed for 7.8 and Stamkos signed for 8.5

I think you could make an easy argument for either of them to sign for 10-11M AAV at the time those deals were done. Stamkos was an MVP / Richard candidate and Hedman a perennial Norris guy

7.8 to 10.5M would be 34% on Hedman.

You are welcome for the free math lesson though

 

[Team Cozens]

For most players, you are looking at around 8% in New York State.

It’s hard to precisely say what it is, because it all comes down to the exact incomes.

However last year, the state income tax ranged from 4% to 8.82%. The Average player like ranges in the 7-8% range.

In Vegas, Tampa, Arizona (I think), Sunrise, Dallas (I think) there is no state tax. So their dollars go 7-8% farther than that of the New York State teams.


However you have to factor in that players pay state taxes on where the games are played. Meaning, out of 41 road games, let’s say 30-35 are in state income tax places.

So now, those players are still paying a bit of state income tax on 30-35% of their pay cheque.


So the real advantage comes if a team like Vegas does heavy signing bonuses.


Now this was a while ago, but I believe someone went through everything from state taxes to federal taxes average cost of living and such, and to match Tampa Bay’s 8.5M contract, Toronto would’ve had to offer 9.8-10.3M IIRC

There are advantages because of destination: Vegas, California, Florida and NYC
There are advantages because of money: Leafs, Oilers, Chicago, Detroit, Canadian, Bruins, Rangers
There are advantage's to being an Original 6:Leafs, Rangers,Blackhawks,Canadians, Red Wings, Bruins
There are advantages to Tax's: Vegas, Florida teams, Arizona, Dallas , not sure about California
There are advantages to where players were born: Leafs mainly.

 

[Icarium]

hedman signed for 7.8 and Stamkos signed for 8.5

I think you could make an easy argument for either of them to sign for 10-11M AAV at the time those deals were done. Stamkos was an MVP / Richard candidate and Hedman a perennial Norris guy

7.8 to 10.5M would be 34% on Hedman.

You are welcome for the free math lesson though

Correlation is not causation. You are welcome for the free logic lesson.

 

[TOGuy14]

Correlation is not causation. You are welcome for the free logic lesson.

yes it is just random coincidence that teams in low tax jurisdictions happen to luck out and have players sign contracts which are notably below market value.

even more amazing is the Tampa Bay times even wrote an entire article about this but you can keep your fingers in your ears and head in the sand as long as you want if it makes you happy

Tax tricks: How an $8.5M Lightning contract keeping Steven Stamkos in Tampa is better than $10.5M to leave

 

[GlassesJacketShirt]

Me: Taxes are a great way to pay for societal benefits and players should be willing to take the hit for the benefit of communities. This is a non factor.

*Sees the Montreal Canadiens get hurt the hardest by local tax laws

Me: Taxation is theft

 

[Icarium]

yes it is just random coincidence that teams in low tax jurisdictions happen to luck out and have players sign contracts which are notably below market value.

Really? Name five players who have signed "notably below market value" for the Panthers, then. Many players leave money on the table if they like playing for a certain team for various reasons. All these "But taxes" complaints ignore the many, many cases of players who do not give discounts to teams from states with no income tax.

 

[Casper The Soy Ghost]

Poor NYR. Nobody ever wants to play for them.
Except Fox. And Trouba. And Panarin. And


If it weren't for taxes and *checks notes* 11m spent on buyouts...

Yeah it sucks. If we had those tax advantages we could sign Scott Gomez 2.0, f*** the CBA.

Edit: just to be clear, I'm being facetious.

 

[ItWasJustified]

here's what 3M looks like in the NHL... (Income Tax Calculator - CapFriendly - NHL Salary Caps)

Their ''calculator'' is way off. The taxasion for NHL player works in a way that they only pay their teams state income tax on the games they play at home. For the other 41 games they pay whatever income tax it is in the state they are playing in. So Montreal Canadiens and Toronto Maple Leafs Players don't pay any income taxes for the 8 games they play in Florida.

 

[Johniac]

The salary cap is the same for all teams, taxes or not. I think you are arguing that some teams should have a bump or penalty in the amount of their cap because players may sign for less in a tax friendly location. As others have noted, there are many kinds of taxes and other intangible benefits to certain locations, so as they say, don't let the tax tail wag the dog. If you want to even out advantages, you would have to factor in way more variables than just taxes.

 

[DJJones]

I love how obsessed hockey fans are with taxes but then half the time people claim taxes mean nothing to where businesses set up shop.

 

[Danrs112]

yes it is just random coincidence that teams in low tax jurisdictions happen to luck out and have players sign contracts which are notably below market value.

even more amazing is the Tampa Bay times even wrote an entire article about this but you can keep your fingers in your ears and head in the sand as long as you want if it makes you happy

Tax tricks: How an $8.5M Lightning contract keeping Steven Stamkos in Tampa is better than $10.5M to leave

It's also a huge benefit when you can point to recent playoff/cup success. You don't have to pay players a premium to come to your crappy team.

What do you suppose they would need in additional cap space to make it fair and overcome that burden?

 

[End of Line]

Does anyone have an excel spreadsheet with state taxes (over 500 000) to get a better idea what each team's actual salary cap is.

NYR and NJD have roughly 6 to 8 million less per season to bargin with than Vegas or Tampa. Is this something that can be changed in the CBA?

Good luck convincing the States to change their tax code

Y’all should vote for MP’s to lower your provincial and National taxes

 

[Legion34]

Good luck convincing the States to change their tax code

Y’all should vote for MP’s to lower your provincial and National taxes

oooooor you know. Changing cap hits based on taxes?

The cap isn’t a real thing. The AAV of a player generally has nothing to do with the actual money paid year by year.

there is nothing to stop the league from Saying


A 5 million hit in new York is 6 million in tampa.

Same money spent.

 

[mouser]

https://thehockeywriters.com/maple-leafs-refs-cba-advantages/

other teams complained that the Leafs were using their facilities in the offseason to rehab injured vets and train rookies, especially those from foreign markets

the pit provisions into the cba that limits this because developing rookies in the offseason is something that only the leafs were doing

so yes I’m sick of being told that tax rates and more don’t matter but being told we can’t even use our practice facilities in the summer

• Clubs are not permitted to have Club Coaching or Hockey Operations personnel (e.g., coaches, skating instructors, other Club employees, contracted service providers, etc.) who participate in any on-ice sessions with Players.
• Clubs are not permitted to request or encourage Players to come to the Club’s home city during the off-season to utilize the Club’s arena/training/practice facility(ies) and/or to train with Club Coaching or Hockey Operations personnel.

Frankly, that’s pretty standard in leagues like the NFL and NBA.

 

[Legion34]

I love how obsessed hockey fans are with taxes but then half the time people claim taxes mean nothing to where businesses set up shop.

If the government imposed an artificial cap on salaries and forced successful businesses to share revenue with weak ones only to allow them
To pay employees
Less


Ya they would. No one cares about taxes. They care about the cap parity that creates a monster loophole

 

[Lazlo Hollyfeld]

Why will this stupid idea not die?

There are many many advantage and disadvantages between markets. State tax for 41 games being only one of them, and likely not the forefront of most players minds.

But suddenly everyone's a tax accountant figuring out what they think the "real" value of contracts are.

 

[Legionnaire]

https://thehockeywriters.com/maple-leafs-refs-cba-advantages/

other teams complained that the Leafs were using their facilities in the offseason to rehab injured vets and train rookies, especially those from foreign markets

the pit provisions into the cba that limits this because developing rookies in the offseason is something that only the leafs were doing

so yes I’m sick of being told that tax rates and more don’t matter but being told we can’t even use our practice facilities in the summer

You could always reduce taxes. One would think TO was the shinig beacon of civilization on the hill with those tax rates but it is far from it.

You elected a crack smoking mayor for crying out loud.

 

[nbwingsfan]

Does anyone have an excel spreadsheet with state taxes (over 500 000) to get a better idea what each team's actual salary cap is.

NYR and NJD have roughly 6 to 8 million less per season to bargin with than Vegas or Tampa. Is this something that can be changed in the CBA?

Are we also going to change the CBA to account for most players coming from Ontario and wanting to go back home?

What about teams who can spend more money on support staff?

What about changing it for teams who have a huge following and can offer local sponsorship money?

What about that everyone wants to live in New York instead of say Cleveland Ohio?

Give it a rest people, the tax benefit isnt nearly as big as fans like to pretend it is.

 

[glovesave_35]

I'm not trying to turn this into a decision brief, it is more a discussion thread. Is there an advantage to sign in certain states and how much is that advantage?

txpd just outlined it all.

 

[Legionnaire]

txpd just outlined it all.

LOL. If you ignore end of year income tax. Other than that right on. Oh, but wait capital gains get taxed too as income.

 

[TOGuy14]

• Clubs are not permitted to have Club Coaching or Hockey Operations personnel (e.g., coaches, skating instructors, other Club employees, contracted service providers, etc.) who participate in any on-ice sessions with Players.
• Clubs are not permitted to request or encourage Players to come to the Club’s home city during the off-season to utilize the Club’s arena/training/practice facility(ies) and/or to train with Club Coaching or Hockey Operations personnel.

Frankly, that’s pretty standard in leagues like the NFL and NBA.

the second rule is fairly standard, but the first one is definitely not

i know people who work for professional sports teams in player development and the facility is open year round to the building and coaches for anyone that wants to take to take advantage

 

[SotasicA]

They should burn enough tires in Canada to warm up Edmonton and Winnipeg to Florida levels of heat, so we'll have an even playing field.

 

[glovesave_35]

It's easy to dismiss this with agents navigating loop holes but to dismiss this as not an advantage is ludacris.

Next, we will have the CBA eliminating massive signing bonuses and paid travel & coaching in the offseason because God forbid a team tries to get better.

Yet tax advantages will remain.

It is my understanding that the massive signing bonuses are where the actual tax advantages reside.

 

[glovesave_35]

LOL. If you ignore end of year income tax. Other than that right on. Oh, but wait capital gains get taxed too as income.

The point is that there are numerous other factors that play into where a player chooses to sign. State taxes is just the low-hanging fruit that any 12 year old can latch onto.