An idea to remove the cap advantage for no tax states

[DFC]

I remember the time Leaf fans were convinced Stamkos was coming home because of all the endorsement opportunities he could get. They brought a Canadian Tire executive into a meeting with him. He resigned with TB and now all we hear about is a tax advantage. Because apparently that trumps the endorsement advantage.

 

[TheNumber4]

Then do it, because you've provided zero empirical evidence that supports your hypothesis.

I actually did provide the Cup winners stat. But we can go a step further, in the last 10 years, of the 20 teams that made it to the SCF finals HALF were No Tax Teams.

Only 19% of the teams in this League have a no tax advantage. And yet no tax advantage teams are reaching the pinnacle of hockey success 50% of the time in recent history.

I’ve already suggested how you could increase this sample significantly further if you want to disprove the stats I’ve already posted. Go ahead if you want to disprove it and maybe you can teach me a thing.

 

[Commander Clueless]

Care isn't what I'm talking about. If whiny owners are complaining about taxes and restructuring the cap on a team by team basis, anybody who's not an idiot running the NHLPA should demand more on revenue sharing. Owners, I suppose, would expect as much.

I imagine they should try and do that anyway.

I don't know that the revenue split negotiation would have too much of an impact on the cap balancing equation, were something like that to exist. I imagine the dollar figures would be first, followed by a cap discussion after.

Simplistic thinking? Maybe. Probably.

 

[Pablo El Perro]

I imagine they should try and do that anyway.

I don't know that the revenue split negotiation would have too much of an impact on the cap balancing equation, were something like that to exist. I imagine the dollar figures would be first, followed by a cap discussion after.

Simplistic thinking? Maybe. Probably.

I'm just assuming the players would use that request to ask for more. I'm fine with that. Just don't think the owners would be.

 

[WhiskeyYerTheDevils]

I actually did provide the Cup winners stat. But we can go a step further, in the last 10 years, of the 20 teams that made it to the SCF finals HALF were No Tax Teams.

Only 19% of the teams in this League have a no tax advantage. And yet no tax advantage teams are reaching the pinnacle of hockey success 50% of the time in recent history.

I’ve already suggested how you could increase this sample significantly further if you want to disprove the stats I’ve already posted. Go ahead if you want to disprove it and maybe you can teach me a thing.

You said the cup winners stat was bogus? What happened from 2006 to 2019? Does that sample not matter?

 

[Nothingbutglass]

Have you seen the cost of home insurance in Fla lately? We definitely need that in the equation

 

[vadim sharifijanov]

From a personal income tax perspective - let me know how that works again?

 

[Pablo El Perro]

You said the cup winners stat was bogus? What happened from 2006 to 2019? Does that sample not matter?

No winning percentage divided by pi times the dollar figure they've paid Bobby Lu. Nobody competes with the Cats.

 

[TheNumber4]

You said the cup winners stat was bogus? What happened from 2006 to 2019? Does that sample not matter?

I didn’t say it was bogus. I said that it was a small sample and we could look at better stats if we want to dig further. So I the provided a sample that was quadrupled (double the years, double the amount of teams that can be considered).

More recent history is always more relevant than older history. Hard Cap only came into effect post 2005, so teams and agents managing caps and the strategies to manage those caps were in its infancy. It makes more sense to use recent history and today’s matured understanding of how the cap works and how to manage it, if you want to see if there is a tangible advantage.

 

[Pablo El Perro]

I didn’t say it was bogus. I said that it was a small sample and we could look at better stats if we want to dig further. So I the provided a sample that was quadrupled (double the years, double the amount of teams that can be considered).

More recent history is always more relevant than older history. Hard Cap only came into effect post 2005, so teams and agents managing caps and the strategies to manage those caps were in its infancy. It makes more sense to use recent history and matured understanding of how the cap works and how to manage it.

That's a theory

 

[Ducks in a row]

I am tired of seeing people wanting to change the salary cap system.
Changing the salary cap because of taxes is so stupid especially when tax rates can be changed which can ruin a team salary cap planning.

 

[Guttersniped]

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?

I agree.

Also, the Rangers have an advantage attracting UFAs, there should be a rule that every player under contract with the NYR has to live in Staten Island.

 

[RogerRoger]

I actually did provide the Cup winners stat. But we can go a step further, in the last 10 years, of the 20 teams that made it to the SCF finals HALF were No Tax Teams.

Only 19% of the teams in this League have a no tax advantage. And yet no tax advantage teams are reaching the pinnacle of hockey success 50% of the time in recent history.

I’ve already suggested how you could increase this sample significantly further if you want to disprove the stats I’ve already posted. Go ahead if you want to disprove it and maybe you can teach me a thing.

Teams with no income tax have won less than 6% of all Stanley Cups and currently 19% of the teams have no income tax. This is blatantly bigoted and unfair. The CBA needs to address this critical issue. The no-income tax teams will not rest untill we have our owed share of Stanley Cup victories.

Make it a rule, that for the next 18 years, the Cup needs to be won by no-income tax teams. Mandatory SC reparation right f***ing now!!

 

[M88K]

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?

Dallas had to pay matt dumba 3.75m and Ilya lyubushkin 3.25m.
That's 2, #6-7 dmen for 7m.
There's no tax advantage for no state tax team.

Also if we're going to arbitrary enforce different cap rules do we also say Toronto and Montreal get lesser cap because of endorsement opportunities that other teams don't get?

 

[SnuggaRUDE]

Dallas had to pay matt dumba 3.75m and Ilya lyubushkin 3.25m.
That's 2, #6-7 dmen for 7m.
There's no tax advantage for no state tax team.

Also if we're going to arbitrary enforce different cap rules do we also say Toronto and Montreal get lesser cap because of endorsement opportunities that other teams don't get?

This would make a lot of sense if hockey or NHL players were popular enough to be culturally relevant. You could probably count on one hand the players who make > $1M in endorsements annually. https://dailyhive.com/edmonton/oilers-mcdavid-highest-paid-nhl-players-endorsements

 

[TheNumber4]

Teams with no income tax have won less than 6% of all Stanley Cups and currently 19% of the teams have no income tax. This is blatantly bigoted and unfair. The CBA needs to address this critical issue. The no-income tax teams will not rest untill we have our owed share of Stanley Cup victories.

Make it a rule, that for the next 18 years, the Cup needs to be won by no-income tax teams. Mandatory SC reparation right f***ing now!!

Cap started post-2005, even for a shit post your post makes very little sense.

 

[Ruggs225]

Write your representatives and governors to lower your state income taxes or eliminate them.

Its a better idea than the NHL trying to fix a problem that doesn't really exist.

Also your money is better off in your hands than the government.

 

[Drake1588]

If they did go down this road, and they won't but if they did... what makes people think they would only craft an algorithm to standardize for income tax? Why does it stop there? What about property tax? State and Federal tax rates? Regional insurance rates for home & natural disasters (hurricane/tornado/earthquake). What about standardizing for what your taxes do or do not theoretically give you, in terms of benefits like free medical care, higher education, etc. What about the price of milk in one city versus another? Grocery bills have skyrocketed due to inflation and it's a factor in every household's calculus, only it's worse in some areas versus others. And on and on. Then when you pick your variables, how do you properly weight each of them?

They aren't going to go down this road because it's not a sports league's job to develop, hone, and constantly tweak an economic model to standardize cost of living and all that this entails. Sure, you could just slap a Big Mac Index on that mother and call it a day, but any move they make will anger just as many teams as are angry now. It doesn't solve the "problem" of every region having unique attributes.

They just aren't going to have any interest in doing this, at any level, and neither is any other sports league in the world.

 

[Viqsi]

I actually did provide the Cup winners stat. But we can go a step further, in the last 10 years, of the 20 teams that made it to the SCF finals HALF were No Tax Teams.

Only 19% of the teams in this League have a no tax advantage. And yet no tax advantage teams are reaching the pinnacle of hockey success 50% of the time in recent history.

I’ve already suggested how you could increase this sample significantly further if you want to disprove the stats I’ve already posted. Go ahead if you want to disprove it and maybe you can teach me a thing.

Your logical fallacy is burden of proof

You said that the burden of proof lies not with the person making the claim, but with someone else to disprove.

yourlogicalfallacyis.com

Yes, again.

 

[Jared Dunn]

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

Yeah, f*** that lol as if these boys haven't been handed enough on silver platters

 

[Bank Shot]

Just find out whatever the overall percentage that tax free teams get over every other team and than allow said teams to go over it by the exact same percentage.

This would be the easiest and most effective way to level the playing field if the NHL was interested in doing so.

 

[WhiskeyYerTheDevils]

I actually did provide the Cup winners stat. But we can go a step further, in the last 10 years, of the 20 teams that made it to the SCF finals HALF were No Tax Teams.

Only 19% of the teams in this League have a no tax advantage. And yet no tax advantage teams are reaching the pinnacle of hockey success 50% of the time in recent history.

I’ve already suggested how you could increase this sample significantly further if you want to disprove the stats I’ve already posted. Go ahead if you want to disprove it and maybe you can teach me a thing.

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):

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:

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.

 

[VikingAv]

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?

Best way to fix this problem is to force teams in no tax states to have poor management of their teams, so their teams are no good.

'Cause there weren't anybody complaining about this when those teams were shit, simply because the best players didn't want to sign with them.

Of course, then the very same people complaining about taxes! will scream move them to Canada! from every mountaintop....

 

[JianYang]

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).

Yes, a recent example of this is Edmonton. You couple the greatest player in the world and a recent final run and guess what.... some noteworthy players actually ended up signing there this offseason.

The best selling point any market can have is a team that free agents belive can realistically get them a cup, and the way to get there is to build a strong foundation through the draft first, which every multi cup winner in the cap era has done whether it's higher cost jurisdictions like Chicago and Los Angeles or otherwise.

 

[Harvey Birdman]

How about just change your tax laws?