An idea to remove the cap advantage for no tax states

[PenguinSuitedUp]

It’s a non-starter for the owners. But if they did want to send more money to the players, that’s how they’d do it. All this other stuff is needlessly complex.

Soft cap is inherently more complex than hard cap.

 

[McShogun99]

Yup, it's all rigged for American teams. And this is coming from an Edmonton fan that was gifted how many first overall picks?

The high taxes in Canada is why a lot of players won't sign there. Canadian teams are at a huge disadvantage because of this. Alberta is the least taxed province in Canada so technically the Oilers and Flames have that advantage over other Canadian teams but nowhere near the advantage that Tennessee, Nevada or Florida have.

 

[GhostfaceWu]

The wealthier teams can spend as much as they want- they can pour money into marketing, property and equipment, staff (scouting, development, etc), and numerous other things.

Meanwhile, the poorer teams are being forced to work harder, because there is a minimum spend requirement. In order to justify spending to the min, teams will need to be competitive to bring fans into the arenas and sell more merch, which will help drive revenue above and beyond spend on salary.

What the cap has done is allow franchises in smaller markets an opportunity to right the ship until they become more viable in their markets in a more sustainable way. And it’s prevented us from having to watch the same six franchises be prominent year in and year out, forcing them to finally work on spending smartly rather than just throwing piles of money wherever and hoping it sticks.


It’s not that simple. Players will get taxed more or less in a year based on the schedule of games they play. If you live in a tax-free state, you are still going to get taxed for the days you spent working/playing games in New Jersey, California, New York, Massachusetts, etc.

I'm fairly certain they have people who could calculate and forecast what the taxes are gonna equate to before the season begins and they can adjust that percentage year by year accordingly.

 

[Profet]

Auston Matthews Shoots and Scores Tax Savings | Crowe Soberman LLP

On February 5, Auston Matthews signed a 5-year contract extension with the Leafs for $58.15M. Fans have reason to be thrilled today, but Canadian taxpayers may be a bit irritated.

www.crowe.com

Taxes are avoidable. People with high incomes have even greater means to avoid taxes.

There is no problem.

 

[PenguinSuitedUp]

I'm fairly certain they have people who could calculate and forecast what the taxes are gonna equate to before the season begins and they can adjust that percentage year by year accordingly.

All teams have this and all players will find that the advantage of playing for one team over another is small in terms of tax advantages, especially compared to other opportunities like endorsement deals.

 

[SpeakingOfTheDevils]

Maybe just hold your out-of-control government to account at the ballot box?

Crazy, I know.

 

[tucker3434]

Soft cap is inherently more complex than hard cap.

It’s much less complex that trying to rope the tax code of 2 countries and 32 cities/states/provinces into the salary cap.

 

[JianYang]

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?

There's alot misinformation been thrown around regarding the extent of the actual tax disparities when it comes to professional hockey players playing in canada/US.

I've posted numerous times regarding this in other threads so I'll leave it at that.

 

[PenguinSuitedUp]

Wrong way round. Advocate for the higher taxation of millionaires.

Let’s just all stop worrying about what other people make and worry about ourselves for once.

 

[joepeps]

To be more fair, I propose we lower the Toronto Maple Leafs cap because too many pyjamas boys want to sign there.

true all 1 person in 30 years lol

 

[triggrman]

Do we also figure out the 7 or 8 games some of these teams play against the no state income tax teams? Do we give breaks for the other 35 or so non home games they play without getting the tax break from state income taxes? Also do people in the lower state income tax stats get less break than so New York or California teams? There's what 5 teams with no state income tax? Also Tennessee has the highest state sales tax, do we figure that in too, there's not many tax shelters for sales tax, almost everyone pays it. Texas has high property taxes do we figure that in too?

Can we also look at the cost of living advantages?

 

[norrisnick]

Let’s just all stop worrying about what other people make and worry about ourselves for once.

That would be worrying about myself (and those around me).

 

[JPT]

No one complained when these so-called small markets weren't competitive and saw more of their stars leave via free agency than they did retaining them. When Florida were missing the playoffs year after year no one said boo about their no-state tax advantage.

Fans need to stop crying about shit like this, same with all they bellyaching and crying about the use of LTIR.

It's OK when the no income tax markets are glorified farm teams for the "traditional" markets

 

[norrisnick]

Auston Matthews Shoots and Scores Tax Savings | Crowe Soberman LLP

On February 5, Auston Matthews signed a 5-year contract extension with the Leafs for $58.15M. Fans have reason to be thrilled today, but Canadian taxpayers may be a bit irritated.

www.crowe.com

Taxes are avoidable. People with high incomes have even greater means to avoid taxes.

There is no problem.

The first paragraph would refute the other..

 

[PenguinSuitedUp]

That would be worrying about myself (and those around me).

No, it isn’t. Life isn’t a zero sum game. Someone else making more money or less money doesn’t impact me. And I’m not going to generate a negative opinion or feeling about someone because they make some arbitrary amount of money.

 

[JianYang]

The high taxes in Canada is why a lot of players won't sign there. Canadian teams are at a huge disadvantage because of this. Alberta is the least taxed province in Canada so technically the Oilers and Flames have that advantage over other Canadian teams but nowhere near the advantage that Tennessee, Nevada or Florida have.

I'd argue that the the biggest deterrent is lack of privacy and enhanced scrutiny.

New York is consistently a desirable destination and their tax/cost of living is sky high.

 

[norrisnick]

No, it isn’t. Life isn’t a zero sum game. Someone else making more money order money doesn’t impact me. And I’m not going to generate a negative opinion or feeling about someone because they make some arbitrary amount of money.

It does if you absolve them of their civic duty. They make money off of the society they live in. They can pay in proportionately. The tax burden is disproportionately carried by the working class to the benefit of the higher earning classes. And you still get folks tripping over themselves to hand out tax breaks to people and companies that don't need them to the detriment of the communities they reside in.

Let's see how many hundreds of millions of unrecoverable tax dollars will go to the next arena project...

 

[PenguinSuitedUp]

It does if you absolve them of their civic duty. They make money off of the society they live in. They can pay in proportionately. The tax burden is disproportionately carried by the working class to the benefit of the higher earning classes. And you still get folks tripping over themselves to hand out tax breaks to people and companies that don't need them to the detriment of the communities they reside in.

Yes, they make their money off the society they live in for the services they provide because they have put the work in to earn it. Good for them. Maybe if I keep putting the effort in, I can achieve the same. Or I can just get to a point where I’m happy with what I have, regardless of what some person on the other side of the continent is doing.

 

[Captain Mountain]

The tax advantage argument is being so wildly overstated right now that its somewhat annoying.

Even ignoring that there is plenty of tax planning options that help level the playing field, the simple fact of the matter is that if it was serious competitive issue, then there would be internal pressure from the NHL to address it, since most of the drivers of NHL revenue come from higher taxed markets.

The truth is that a lot of the teams with lower income tax who have "an unfair advantage with the salary cap as they're able to sign players at a discount", used to be teams who had to overpay players to sign with them or couldn't compete with teams in other markets spending-wise.

At the end of the day, being a strong team that can compete for the cup and offer opportunities for players is by far the biggest reason teams can get players to sign for them (under market value or not).

 

[TheDawnOfANewTage]

How about no? Yea, tax me to holy hell but please don’t tax my favourite athletes. Sounds ludicrous. I am sorry.

Why shouldn’t they get the same advantages as their billionaire owners?

Kidding, Chuck the whole structure into the sea and start again.

Anyway, to OP’s point- seems rather unscientific. Just make automatic adjustments in the next CBA. If one team has an effective state tax rate of 5%, another 2.3%, and another 0%, you can math that out so they’re all actually given an equal playing field.

Oh, and states competing for businesses by eliminating taxes and gutting social services is the least “united” thing I can think of, but that gets into less hockey-specific territory.

 

[Sasha Orlov]

Just pass laws at the state/provincial level that says athletes are exempt from state income taxes.

This would legitimately make me do things that I cannot legally put in writing

 

[Profet]

The first paragraph would refute the other..

Only for the poors

 

[norrisnick]

Only for the poors

Say hello to 90% of the world that you share the planet with.

 

[Profet]

Say hello to 90% of the world that you share the planet with.

/wave

 

[NOTENOUGHRYJOTHINGS]

The West Coast teams having extra travel is a bigger problem than taxes. Ever since Gary Bettman invented state taxes in 2018 to benefit Vegas everyone knows about the tax issue. But few people know about West Coast teams having extra travel. Which is the reason why no team in the Pacific time zone has ever won the cup in the entire 9 year history of the NHL.

East Coast teams should be forced to fly to a different city and do a one hour layover every road trip. Or the NHL should pass laws to move every western conference city closer together.