An idea to remove the cap advantage for no tax states

[HaNotsri]

Just base the cap on net pay instead of gross.

 

[DistantThunderRep]

Data needs context. If an insignificant amount of contracts were signed by the No tax teams (only 4 existed back then), then using the early salary cap era numbers actually obscurs the data and makes it worse.

Dallas, Tampa, Florida, Nashville have all existed since the 90's. Only change is in recent years they added Vegas and Seattle. So using the majority of the Teams in the data doesn't skew anything. If anything adding Vegas and Seattle with a bigger league makes the numbers worse for you idiotic argument.

Lets not forget this is just a hypothetical exercise. In the real world, no one gives a shit or has any desire to change it.

I've been saying this the whole time. I will offer up my account and have it shut down if during the next CBA either players or owners even attempt to address anything.

 

[triggrman]

Thanks for finding that GJ! Absolutely ridiculous to me that someone could publish something like that which is COMPLETELY misleading and expect to be taken seriously. So "assuming he only plays home games in FLA" he's going to save $1.4M! Did Reinhart pull a Bob Probert and wasn't allowed to leave the state for "Department of Corrections" reasons?

Are you telling me that hockey players aren't just filing with a 1040ez?

Just base the cap on net pay instead of gross.

It's your belief that anyone is going to complete just openly share their finicials?

 

[DistantThunderRep]

Just base the cap on net pay instead of gross.

For 100000th time, its not that simple. Net pay is dependent on actions taken by the individual player. Also if you do that, now you have 32 different salary caps across the league. Trades and FA signings would be a nightmare and teams and players and the league as a whole would incur ridiculous costs across the board to constantly keep on top of it. Also you wouldn't be able to project Salary Caps YoY, you would have to project 18 months to 24 months in advance because you would have to wait for each country + province + state to submit their plan and then wait for it to pass and then apply your calculations across 32 teams.

How does any of that seem simple?

 

[Beukeboom Fan]

Are you telling me that hockey players aren't just filing with a 1040ez?

I would pay for a reality show where a professional hockey player tries to do his own taxes. Something like "Clarkson's Farm" but it would be "Tavares' Taxes"!

 

[Fig]

For 100000th time, its not that simple. Net pay is dependent on actions taken by the individual player. Also if you do that, now you have 32 different salary caps across the league. Trades and FA signings would be a nightmare and teams and players and the league as a whole would incur ridiculous costs across the board to constantly keep on top of it. Also you wouldn't be able to project Salary Caps YoY, you would have to project 18 months to 24 months in advance because you would have to wait for each country + province + state to submit their plan and then wait for it to pass and then apply your calculations across 32 teams.

How does any of that seem simple?

Good on you for replying.

I thought about it, then fixated on the last word of that post.

 

[DustyDangler]

For 100000th time, its not that simple. Net pay is dependent on actions taken by the individual player. Also if you do that, now you have 32 different salary caps across the league. Trades and FA signings would be a nightmare and teams and players and the league as a whole would incur ridiculous costs across the board to constantly keep on top of it. Also you wouldn't be able to project Salary Caps YoY, you would have to project 18 months to 24 months in advance because you would have to wait for each country + province + state to submit their plan and then wait for it to pass and then apply your calculations across 32 teams.

How does any of that seem simple?

Yup. You would also need to get into political forecasting. What if Florida got a Democrat governor and/or legislature and pumped up the FL income tax?

 

[DistantThunderRep]

Good on you for replying.

I thought about it, then fixated on the last word of that post.

Its insane to me how so many people don't understand the complexity of "basing it on net". On the surface it seems fine. But that's if you don't spend more than 5 minutes thinking about it.

Like 2 players on the same team with the same contract could have two different tax burdens. How the hell would you account for that if its "based on gross"?

That simple question brings crickets.

How would you trade a player? If a player gets traded from Dallas to Montreal, does that mean their cap goes down? But what if said player remains as a Texas resident and has a signing bonus contract? The gross of that income is higher regardless of where they play because his Gross income was taxed in Texas? So what do you put down on the cap?

Its so stupid to just say "base it on gross"

Yup. You would also need to get into political forecasting. What if Florida got a Democrat governor and/or legislature and pumped up the FL income tax?

Exactly. Like my post above, there is even basic shit like trades and bonuses being paid out and how you would adjust for the cap on that? But you know its simple "USE THE CALCULATOR AND BASE IT ON GROSS!"

EDIT: Just even thinking a bit more? Do you base it on YoY gross income? Or do you base it on Gross Income on the time of signing? Do you re-adjust during the season because there is emergency taxes implemented? What about places that have a Wealth Tax on High Salaries?

 

[FiveTacos]

A lot of this stuff is relevant to your middle class schlub. Less relevant for millionaires. The effects are overstated as well.

Housing prices are just market values. You pay more, you get more when you sell.

That's an up front cost that can be significant, and when you have places in say the Bay Area that are literally condemned still being sold for over a million sight unseen, I guarantee you the housing costs matter greatly even to millionaires. Especially when they have to pay property tax every year on a multimillion dollar house instead of a similar house elsewhere that costs 500k. Or the difference in insurance costs between the two. Or the cost of utilities in a place like that. Tell me how you get all that money back when you sell.

And also ignored that there are different definitions of success in this League.

Well, you seem to be the one wanting to arbitrarily define success in this way, but not that other way, oh but wait not that first way either because the data didn't fit so now we have to define it this other way ...

Apparently the income tax advantage allows teams to win 4 out of 7 games three times, but doesn't necessarily help you win 4 out of 7 four times. Nor does it seem to make any difference over 82 games for 32 teams over 10 years or 20 years or whatever. Only very specifically, it's an advantage in helping teams win 3 rounds a year, and only for a very specific time period of the last 5 years.

I’ve never understood why any athlete would not want to play in Tampa

Bugs. Big F'in bugs.

or Vegas

If you don't gamble or give a crap about the total touristy zoo down by the Strip, other towns have way more to offer.

 

[T REX]

16 pages? No thanks.

 

[x Tame Impala]

It’s not cherry picked data. You are only characterizing it as that cause you ignored now on two occasions the reasoning as to why looking at the immature, fresh hard cap market era would make less sense than more recent history.

And also ignored that there are different definitions of success in this League.

Final Four Teams in NHL Playoffs by year...

2024: Edmonton, Florida, Dallas, New York
2023: Dallas, Vegas, Florida, Carolina
2022: Colorado, Edmonton, New York, Tampa
2021: Islanders, Tampa, Montreal, Vegas
2020: Vegas, Dallas, Tampa, Islanders
2019: St. Louis, San Jose, Boston, Carolina
2018: Winnipeg, Vegas, Washington, Tampa
2017: Nashville, Anaheim, Ottawa, Pittsburgh
2016: San Jose, St. Louis, Tampa, Pittsburgh
2015: Chicago, Anaheim, Tampa, New York
2014: Chicago, LA, New York, Montreal
2013: Chicago, LA, Boston, Pittsburgh
2012: LA, Arizona, New Jersey, New York
2011: Vancouver, San Jose, Boston, Tampa
2010: Chicago, San Jose, Philadelphia, Montreal
2009: Chicago, Detroit, Pittsburgh, Carolina
2008: Detroit, Dallas, Pittsburgh, Philadelphia
2007: Anaheim, Detroit, Buffalo, Ottawa
2006: Carolina, Buffalo, Edmonton, Anaheim

Florida, Texas, Nevada, and Tennessee are the relevant teams here with no income tax. Teams from these states have appeared in the Final Four 18 times out of a possible 76 times. That's 23.6%.

California, New York, New Jersey, and DC are all in the top 10 of income tax rate in the country. That's 21 out of 76 times, 27.6%. Illinois is right there as well with the 8th highest tax burden in the country so if I include the Blackhawks that's 26/76 times for 34.2%. If I include California, New York, New Jersey, DC, Chicago, and the Canadian teams that's 37/76 times for 48.6%. I'll also point out that states like Colorado, Michigan, Pennsylvania, Massachusetts aren't exactly tax havens either.

This argument is absolutely absurd. I've wasted my afternoon with this and now I feel like a dummy for giving it so much attention.

 

[Faceboner]

A lot of talk lately about certain teams without income tax having an unfair advantage with the salary cap as they're able to sign players at a discount. Not much talk about how to fix it but I have one fairly simple idea (in theory). Fans of these teams won't like it but how about no tax teams don't get the cap increase that is going to be taking place over the next few seasons? It's expected to go past $100 million in 3 seasons or so, well how about no tax teams stay at $88 million or at least have a reduced cap increase compared to every other team.

Eventually the league settles on a certain percentage, whether it's 15-25% less than other teams - at least this advantage will be taken away from them. It might be complicated to have two different salary caps but perhaps its worth a try. Thoughts?

Or instead, same idea, but instead of capping non income tax states give teams with income tax cap relief percentage based on the % of tax per state/province and promote more parity

 

[TheNumber4]

Dallas, Tampa, Florida, Nashville have all existed since the 90's. Only change is in recent years they added Vegas and Seattle. So using the majority of the Teams in the data doesn't skew anything. If anything adding Vegas and Seattle with a bigger league makes the numbers worse for you idiotic argument.


I've been saying this the whole time. I will offer up my account and have it shut down if during the next CBA either players or owners even attempt to address anything.

And the salary cap has only existed post 2005. So it’s not the only change being Vegas and Seattle. It would be downright dumb to include irrelevant data from the 90s. Is that what you are suggesting?

Cause what I’m NOT suggesting is to not look at all teams. You have to to
Make the comparison. But the comparison can only be made with an appropriate time line.

Final Four Teams in NHL Playoffs by year...

2024: Edmonton, Florida, Dallas, New York
2023: Dallas, Vegas, Florida, Carolina
2022: Colorado, Edmonton, New York, Tampa
2021: Islanders, Tampa, Montreal, Vegas
2020: Vegas, Dallas, Tampa, Islanders
2019: St. Louis, San Jose, Boston, Carolina
2018: Winnipeg, Vegas, Washington, Tampa
2017: Nashville, Anaheim, Ottawa, Pittsburgh
2016: San Jose, St. Louis, Tampa, Pittsburgh
2015: Chicago, Anaheim, Tampa, New York
2014: Chicago, LA, New York, Montreal
2013: Chicago, LA, Boston, Pittsburgh
2012: LA, Arizona, New Jersey, New York
2011: Vancouver, San Jose, Boston, Tampa
2010: Chicago, San Jose, Philadelphia, Montreal
2009: Chicago, Detroit, Pittsburgh, Carolina
2008: Detroit, Dallas, Pittsburgh, Philadelphia
2007: Anaheim, Detroit, Buffalo, Ottawa
2006: Carolina, Buffalo, Edmonton, Anaheim

Florida, Texas, Nevada, and Tennessee are the relevant teams here with no income tax. Teams from these states have appeared in the Final Four 18 times out of a possible 76 times. That's 23.6%.

California, New York, New Jersey, and DC are all in the top 10 of income tax rate in the country. That's 21 out of 76 times, 27.6%. Illinois is right there as well with the 8th highest tax burden in the country so if I include the Blackhawks that's 26/76 times for 34.2%. If I include California, New York, New Jersey, DC, Chicago, and the Canadian teams that's 37/76 times for 48.6%. I'll also point out that states like Colorado, Michigan, Pennsylvania, Massachusetts aren't exactly tax havens either.

This argument is absolutely absurd. I've wasted my afternoon with this and now I feel like a dummy for giving it so much attention.

So the most relevant timeline of recent history, past the infancy of the salary cap era where there’s been enough time for
Teams and agents to sign contracts and understand how to take advantage of the tax advantage on those contracts. It shows much more success than could be expected for the No Tax Advantaged teams.

The No tax remains an advantage with that data set you posted. Confirming what experts in the field have already said, that’s no taxes is an advantage for teams in team building.

 

[T REX]

Just because you're being intentionally annoying & obtuse about this, I did the work for you.

Here is regular season P% during the cap era vs the effective income tax rate in a given city/state/province at a $4M salary assuming no deductions (US rate calculator, Canadian rate calculator):
View attachment 893479
In case you didn't know, an R^2 of 0.019 is incredibly low, meaning there is no relationship between regular season success and effective income tax

I did the same thing for playoff success in the cap era:
View attachment 893481
R^2 of 0.003 (wins) and 0.045 (win %) means there is also no relationship between playoff success and effective income tax.

The 7 Canadian teams have averaged only 38.9 playoff wins per team in the last 20 years, while American teams have averaged 57.0. But what really kills your hypothesis is that the top 7 highest taxed teams in the US have averaged 62.0 playoff wins per team in that span, which is a fair amount higher than the rest of the US teams (57.8 excluding Seattle).

So it's not the tax system keeping Canadian teams down (and it's certainly not the entry drafts, Canadian teams have picked 1st overall in 30% of the drafts in the cap era despite accounting for only 20-22% of the league). I would hypothesize that the culprit is poor/desperate management, driven by pressure from owners & media. I think there are also a fair amount of American players who no longer want to risk playing in Canada after what happened with COVID, which has hurt Canadian franchises more recently.

Regardless, I hope you can accept that the data in no way supports your claim that the tax advantage is driving results in this league.

/thread

Suggestion, maybe we need to merge these with old threads going forward instead of rehashing the same over and over(but I guess that what a message board is lol).

 

[DistantThunderRep]

And the salary cap has only existed post 2005. So it’s not the only change being Vegas and Seattle. It would be downright dumb to include irrelevant data from the 90s. Is that what you are suggesting?

Cause what I’m NOT suggesting is to not look at all teams. You have to to
Make the comparison. But the comparison can only be made with an appropriate time line.


So the most relevant timeline of recent history, past the infancy of the salary cap era where there’s been enough time for
Teams and agents to sign contracts and understand how to take advantage of the tax advantage on those contracts. It shows much more success than could be expected for the No Tax Advantaged teams.

The No tax remains an advantage with that data set you posted. Confirming what experts in the field have already said, that’s no taxes is an advantage for teams in team building.

Ok...I am going to put this the simplest way possible...

What year is it? No subtract 20 years from there....what year is it? And then use all your brain power to figure out why @WhiskeyYerTheDevils used 20 years as the starting point....

 

[JPT]

And the salary cap has only existed post 2005. So it’s not the only change being Vegas and Seattle. It would be downright dumb to include irrelevant data from the 90s. Is that what you are suggesting?

Cause what I’m NOT suggesting is to not look at all teams. You have to to
Make the comparison. But the comparison can only be made with an appropriate time line.


So the most relevant timeline of recent history, past the infancy of the salary cap era where there’s been enough time for
Teams and agents to sign contracts and understand how to take advantage of the tax advantage on those contracts. It shows much more success than could be expected for the No Tax Advantaged teams.

The No tax remains an advantage with that data set you posted. Confirming what experts in the field have already said, that’s no taxes is an advantage for teams in team building.

I've only seen one "expert" mentioned, and they are a tax consultant. Who are the others?

 

[DistantThunderRep]

Or instead, same idea, but instead of capping non income tax states give teams with income tax cap relief percentage based on the % of tax per state/province and promote more parity

Read my posts above and answer those questions for me. IF you have this all figured out.

 

[TheNumber4]

Ok...I am going to put this the simplest way possible...

What year is it? No subtract 20 years from there....what year is it? And then use all your brain power to figure out why @WhiskeyYerTheDevils used 20 years as the starting point....

View attachment 893677

And I’m going to repeat that more recent history is more relevant than past history to see if the effects of No Taxes had an effect on winning. My reasoning for that has been posted, refute my reasoning if you can, and if it’s a good argument you may be able to convince me otherwise. Don’t refute it, and I’m gonna continue taking the word of experts on this subject instead of biased homers on an internet message board

 

[x Tame Impala]

Its insane to me how so many people don't understand the complexity of "basing it on net". On the surface it seems fine. But that's if you don't spend more than 5 minutes thinking about it.

Like 2 players on the same team with the same contract could have two different tax burdens. How the hell would you account for that if its "based on gross"?

That simple question brings crickets.

How would you trade a player? If a player gets traded from Dallas to Montreal, does that mean their cap goes down? But what if said player remains as a Texas resident and has a signing bonus contract? The gross of that income is higher regardless of where they play because his Gross income was taxed in Texas? So what do you put down on the cap?

Its so stupid to just say "base it on gross"


Exactly. Like my post above, there is even basic shit like trades and bonuses being paid out and how you would adjust for the cap on that? But you know its simple "USE THE CALCULATOR AND BASE IT ON GROSS!"

EDIT: Just even thinking a bit more? Do you base it on YoY gross income? Or do you base it on Gross Income on the time of signing? Do you re-adjust during the season because there is emergency taxes implemented? What about places that have a Wealth Tax on High Salaries?

Also, what about NHLer's OTHER forms of income? Is that magically not relevant? The millions dollars they make a season affords them all sorts of opportunities to make money. What about income from endorsements? Auston Matthews can do things making $13.25m a year that Jeff Skinner making $3m this season can't.

 

[Nicko999]

If you don't want certain provinces/states to enjoy workplace benefits due to their lower taxes, then pass legislation to stop taxing your people to blue hell and let people keep more of their money.

The myriad benefits extend well beyond the world of sport.

Exactly.
It's the same thing with highly skilled specialists as well. If you have a choice, you will go to the place that has less taxes. It's up to provinces/states/counties to pass law in order to make those places more attractive to high earners.

 

[DistantThunderRep]

And I’m going to repeat that more recent history is more relevant than past history to see if the effects of No Taxes had an effect on winning. My reasoning for that has been posted, refute my reasoning if you can, and if it’s a good argument you may be able to convince me otherwise. Don’t refute it, and I’m gonna continue taking the word of experts on this subject instead of biased homers on an internet message board

Also, what about NHLer's OTHER forms of income? Is that magically not relevant? The millions dollars they make a season affords them all sorts of opportunities to make money. What about income from endorsements? Auston Matthews can do things making $13.25m a year that Jeff Skinner making $3m this season can't.

Hilariously, in these idiots minds, they think Matthews contract would come down. It wouldn't since his Signing Bonus heavy contract is taxed at a lower rate in Arizona since that is still his residency. So in that sense, he would actually have a pretty similar cap hit to now.

 

[The Management]

I would submit that taxes are just as nuanced and difficult to regulate as tax rates. State income taxes are only one of many factors which also influence include local taxes (which can vary by zip code), tac brackets, international considerations, etc etc etc.

Yeah, a fair point to be sure.

 

[x Tame Impala]

So the most relevant timeline of recent history, past the infancy of the salary cap era where there’s been enough time for
Teams and agents to sign contracts and understand how to take advantage of the tax advantage on those contracts. It shows much more success than could be expected for the No Tax Advantaged teams.

The No tax remains an advantage with that data set you posted. Confirming what experts in the field have already said, that’s no taxes is an advantage for teams in team building.

Relevant to your narrative. You can't just handwave away the other 15 years you don't want to include. "infancy of the salary cap era" is a weak rebuttal dude. Players, GM's, agents, didn't know what taxes were until 2020? Come on.

 

[Golden_Jet]

And the salary cap has only existed post 2005. So it’s not the only change being Vegas and Seattle. It would be downright dumb to include irrelevant data from the 90s. Is that what you are suggesting?

Cause what I’m NOT suggesting is to not look at all teams. You have to to
Make the comparison. But the comparison can only be made with an appropriate time line.


So the most relevant timeline of recent history, past the infancy of the salary cap era where there’s been enough time for
Teams and agents to sign contracts and understand how to take advantage of the tax advantage on those contracts. It shows much more success than could be expected for the No Tax Advantaged teams.

The No tax remains an advantage with that data set you posted. Confirming what experts in the field have already said, that’s no taxes is an advantage for teams in team building.

That’s quite the reach to think it takes a decade, to figure out that in some states, a player will pay less tax for half the season.

Those no tax teams weren’t as competitive back then.
So let’s eliminate the data the doesn’t suit your needs, just because.

 

[TheNumber4]

Relevant to your narrative. You can't just handwave away the other 15 years you don't want to include. "infancy of the salary cap era" is a weak rebuttal dude. Players, GM's, agents, didn't know what taxes were until 2020? Come on.

I’m not handwaiving away anything. I provided reasoning as to why looking at the early years of the salary cap era makes less sense than looking at the later years. Early vs late was cut off at the half way poiint, so it’s not 15 years.

Players agents and teams hadn’t fully figured out how to optimize caps and contracts in this entirely new world and landscape back in 2005 and onward. Contracts signed and teams built in that era also need time to fully optimize in general. It was never 2020 I was talking about.

You know what’s a weak rebuttal? No even understanding the argument being made then just calling it weak without providing any relevant reasoning.