An idea to remove the cap advantage for no tax states

[Laus723]

The TV deal they just signed is nuts which definitely helps.

Keeping in mind though, I think the NBA has done fairly well in not having the top teams always dominate.

Toronto Raptors won
Lebron won Cleveland a title (Probably similar to a McDavid effort)
Bucks won a title

Not a big basketball guy either but before Currie came in, was Golden State a big hot spot?

I think we've just seen McDavid move mountains for Edmonton but come up short.

End of the day, I think 5-10M luxury tax for teams like NYR/TOR/MTL etc (if they chose to spend it) and generating an additional 10M to split amongst lower revenue teams is probably as good of a compromise as you can find.

I don't think it's a coincidence one of these no state income taxes finds itself in a final every year.

Lmao, what's actually a coincidence, is these "no state income tax team" in 3 of the last 5 years have all gone way above the cap through LTIR. Panthers sure af didn't, and (as stated above) we just lost our whole 4th line and 2 of bottom 6 defenders due to not being able to pay them what they wanted.

Tallon paid Bob 10 Mil per season, he didn't have to do that at the time, he had money to spend and outbid himself on Bob as well overspent on Connolly and Stralman that year. Counter that with Zito who's found guys on the waiver wire, others who weren't playing up to expectations elsewhere and was able to re-sign them to team friendly deals, and went bargain hunting in Free Agency. I was shocked he let Stenlund go, guy's a fantastic 4th line center and PKer, Zito used that money to help bring in guys like Schmidt, both Boqvists, Greer, Driedger and Nosek.

So far as Reinhart goes, he knows what it's like to be on a team that isn't winning and who doesn't know how to use him. Signs a long term, team friendly deal, then fans of teams who are about to have 4 guys make 45-50+ mil cry about taxes.

I've said before and I'll say it again, it takes a very smart GM and owners who are willing to spend and invest both in the fans and the team itself.

No other league's fans cry about taxes.

 

[VinikToWinIt]

Should we also apply cap adjustments to teams who are in markets where more endorsement deals are available? What about adjustments for cost of living? Should we update cap for changes in the currency exchange rate?

The answer is no. Florida was a loser franchise for years, and players had no interest in sacrificing money to go there. Canadian fans complained about the fact that there is a franchise in Florida for two decades. Now that Florida is winning, they want to reduce their ability to compete. Winning is driving Florida’s contracts down, not tax dollars.

I think we should have a tiered cap based on last season's results.

Oh you won the Cup last season? Have fun making it work with a $50M cap next year. Columbus? They get $200M.

The only way to ensure a fair playing field is to reduce the cap for good teams, and increase it for others. Winning teams are more attractive to free agents, and thus perpetuate an unfair system. I won't rest until no team has any inherent benefits, and every team is 0.500.

The perfect parity dream is within our grasp.

 

[Peltz]

The whole idea that this is something that needs to be fixed is flawed from the get-go.

Different places are attractive to different players for various reasons. The NHL can't and shouldn't penalize teams and players for that.

Also, the premise of the cap making things "fair" is a secondary consideration that justifies it to fans. The real reason it exists is to protect the owners and hurt the players. Full stop.

 

[JPT]

I think we should have a tiered cap based on last season's results.

Oh you won the Cup last season? Have fun making it work with a $50M cap next year. Columbus? They get $200M.

The only way to ensure a fair playing field is to reduce the cap for good teams, and increase it for others. Winning teams are more attractive to free agents, and thus perpetuate an unfair system. I won't rest until no team has any inherent benefits, and every team is 0.500.

The perfect parity dream is within our grasp.

The playoffs don’t make it past Game 1 of each series because every game goes into 20 OT periods and all of the players drop dead.

 

[Scrantonicity 2]

Someone correct me please - hasn't the tax thing been debunked ad nauseum? Even by player agents?

 

[WTFMAN99]

It was already addressed above, but just to provide a response — orgs like the Hornets and Pelicans exist because people in those cities go to see the Lakers and Celtics a few times a year. They make money because of the NBA’s television setup, but if you forced them to rely on ticket sales they would go bankrupt overnight.

The NBA has fully bought into the idea that only about ten markets really matter, and those should be stacked with all the best players for a national audience. Imagine what that would look like in an NHL context where they play on ESPN8, and the biggest “stars” in major markets are relative nobodies like Pastrnak and Shesterkin, and the most profitable fifth of the league isn’t even on US television.

It would be the worst of both worlds — a league full of farm teams for the handful of biggest markets which are stacked with players that most people have never heard of, rendering 60% of the games unwatchable and another 30% unmarketable. A league that doesn’t grow its value on tickets OR television.

Right, NHL is a gate driven league NBA teams do have the benefit of an insanely great TV deal.

We could say if they were forced to rely on the gate revenue they're screwed but the reality is they are not relying just on that.

Merch, ticket sales on top of a great tv deal is pretty great.

I also think NBA has a pretty insane ceiling for luxury tax, I didn't want to see it go beyond a 5-10M luxury tax ceiling because after that, the competitive balance isn't there, I want the most equal footing possible in a hard cap league.

There already is a revenue sharing model in the CBA.
~ 1/3 of playoff revenue goes to revenue sharing , unless your talking about giving them more. The rest coming from high revenue teams.

I think the “tax” would be split amongst all the teams not using the luxury tax.

It's not my money ultimately so if it was split amongst the non-luxury tax users, that seems fair too.

 

[JPT]

Someone correct me please - hasn't the tax thing been debunked ad nauseum? Even by player agents?

Hell, it was debunked with hard data in this thread, but someone read something that a tax consultant claimed and now we’re 22 pages deep.

 

[DistantThunderRep]

The TV deal they just signed is nuts which definitely helps.

Keeping in mind though, I think the NBA has done fairly well in not having the top teams always dominate.

Toronto Raptors won
Lebron won Cleveland a title (Probably similar to a McDavid effort)
Bucks won a title

Not a big basketball guy either but before Currie came in, was Golden State a big hot spot?

I think we've just seen McDavid move mountains for Edmonton but come up short.

End of the day, I think 5-10M luxury tax for teams like NYR/TOR/MTL etc (if they chose to spend it) and generating an additional 10M to split amongst lower revenue teams is probably as good of a compromise as you can find.

I don't think it's a coincidence one of these no state income taxes finds itself in a final every year.

The bolded was because of Drafting high and getting Top Picks after being shit.

Toronto traded for Kawhi Leonard, but also was a lot of players that they drafted that rounded out the team.

 

[DistantThunderRep]

Alternatively, what if NMC/NTCs were restricted to only the elite players. Lets say that's the top 5%, for example, as of the time the contract signed?

This way theres more fluidity in trading players. Player movement is less dependant on the appeal of the market.

It would need to be negotiated into the next CBA but that seems more realistic than making players employees of the league (not the teams) or some ham fisted one size fits all attempt to address complexities related to taxes.

So you think players will agree to having less control and job certainty? Ok....

 

[John Mandalorian]

So you think players will agree to having less control and job certainty? Ok....

Did you notice that the word "negotiated" was used? Is it normal for you to go stomping around thinking you're making a point when ignoring half the comment you're replying to? Is that your thing?

 

[Viqsi]

It was already addressed above, but just to provide a response — orgs like the Hornets and Pelicans exist because people in those cities go to see the Lakers and Celtics a few times a year. They make money because of the NBA’s television setup, but if you forced them to rely on ticket sales they would go bankrupt overnight.

The NBA has fully bought into the idea that only about ten markets really matter, and those should be stacked with all the best players for a national audience. Imagine what that would look like in an NHL context where they play on ESPN8, and the biggest “stars” in major markets are relative nobodies like Pastrnak and Shesterkin, and the most profitable fifth of the league isn’t even on US television.

It would be the worst of both worlds — a league full of farm teams for the handful of biggest markets which are stacked with players that most people have never heard of, rendering 60% of the games unwatchable and another 30% unmarketable. A league that doesn’t grow its value on tickets OR television.

I'm quite convinced that a lot of the folks who demand these sorts of adjustments think the NHL should be operating exactly the same way and so consider this to be a feature rather than a bug, because obviously their teams will be part of the Markets That Matter.

 

[tarheelhockey]

I'm quite convinced that a lot of the folks who demand these sorts of adjustments think the NHL should be operating exactly the same way and so consider this to be a feature rather than a bug, because obviously their teams will be part of the Markets That Matter.

I’m guessing they don’t understand the implications of NBA properties being literally multiples more valuable than the NHL, with most of that value concentrated at the top. That’s a league which can afford to treat 2/3rds of its constituent entities as a farm league.

 

[DistantThunderRep]

Did you notice that the word "negotiated" was used? Is it normal for you to go stomping around thinking you're making a point when ignoring half the comment you're replying to? Is that your thing?

Holy hell, is your thing not understanding basic logic?

Alternatively, what if NMC/NTCs were restricted to only the elite players

This is stupid as f***. Just like everything else you have said. My statement is still true. You want players to give up more power and control over their contracts.

It would need to be negotiated into the next CBA but that seems more realistic than making players employees of the league (not the teams) or some ham fisted one size fits all attempt to address complexities related to taxes.

No its not realistic, Actually its increasingly stupid for both the owners and players. Owners would have less cost control, Players would have less control of where they want to play.

Like I didn't realize I had to come to this level of stupid to explain to people basic things.

 

[Derailed75]

They get a few weeks a year under ice lately

I live in Virginia on pretty much the same parallel as Nashville, hours is spelled HOURS not WEEKS.

Hasnt been any snow at all for the last 3 years (maybe flurries) and the ice is closer to freezing rain.

 

[TurgPavs]

I guess the tax advantage is the new East vs West Travel advantage that I am sure we will figure out......

 

[Viqsi]

I’m guessing they don’t understand the implications of NBA properties being literally multiples more valuable than the NHL, with most of that value concentrated at the top. That’s a league which can afford to treat 2/3rds of its constituent entities as a farm league.

Sounds like the same sort of Failure To Understand Scale issues that also leads to suggestions of putting teams in places like Halifax and Sasakatoon.

 

[JPT]

I live in Virginia on pretty much the same parallel as Nashville, hours is spelled HOURS not WEEKS.

Hasnt been any snow at all for the last 3 years (maybe flurries) and the ice is closer to freezing rain.

Cool. In January most of middle Tennessee was under a sheet of ice for a week.

 

[VoidCreature]

Apply the cap to post tax income. Done.

 

[JPT]

Apply the cap to post tax income. Done.

We went over the whole "base it on net income" thing probably 12 pages back.

 

[Golden_Jet]

Apply the cap to post tax income. Done.

That’s been covered many times in here.

 

[DistantThunderRep]

Apply the cap to post tax income. Done.

 

[Zetterberg4Captain]

So your solution are:

1) Can you explain how the revenue share fixes ANY sort of competitive imbalance from a state tax difference?

or:

2) Exclude 1/3 of the teams from the salary cap. The NHL sacrificed over 1.5 years of play to get the 50% hard salary cap in place, but they're going to exclude 1/3 of the teams from the cap because state taxes?

Ok...so the solution is...let the competitive tax advantage go unchecked, because you know state/province policies, and we also want your money to help keep us afloat?

 

[SeanAveryTheGreatOne]

League reimburses players' income tax in the new CBA

 

[tucker3434]

There already is a revenue sharing model in the CBA.
~ 1/3 of playoff revenue goes to revenue sharing , unless your talking about giving them more. The rest coming from high revenue teams.

I think the “tax” would be split amongst all the teams not using the luxury tax.

You could split it so that it both reduces the pay-in from the other big earners and increases the total pay-out pool to the bottom 1/3. That’s how you’d get teams to vote for it. 2/3 would benefit (slightly) any year that a team utilized the luxury tax.

But I still think it’s a solution in search of a problem. The big dogs love their profit margins.

 

[majormajor]

Apply the cap to post tax income. Done.

That would be nearly impossible to plan for teams because they have no control over a players tax situation from year to year.

It is true that a post tax income can't be known exactly ahead of time. Circumstances will change year to year.

But you can use an estimate of post tax income at the time of signing that will on average get it right.

I think we've got a case of lawyer-brain here where the inexactness is used as an excuse to do nothing. I have economist-brain and I think a good estimate coming from a consistent formula would solve almost the entire problem, so we should just do that.