Idea re taxes and salary cap

[tucker3434]

The people who suggest making the salary cap have any tax dependence:

1. Don't understand how taxes are collected in the NHL (they're collected based on where you're playing games, so it's not 100% home)
2. Don't understand the different levels of how teams are taxed (teams like Tampa don't have "no taxes", they have no state income tax, which is a small portion of total taxes)
3. Don't understand that there is a cost of living difference between cities, one you can easily complain about not being included in the salary cap
4. Don't understand that there is a quality of life difference between cities, one you can easily complain about not being included in the salary cap
5. Don't understand that making a tax dependent salary cap is extremely complicated and puts pressure on government officials to make decisions based on sports, which is absolutely not what a government should be doing.

Well, that pretty much covers it. I’d only add that I’m not sure owners are as excited about spending more money as their fans are. I’d assume a change like this would require at least a majority of the owners to agree. I don’t think you’d get close to 17 votes.

 

[Peasy]

The people who suggest making the salary cap have any tax dependence:

1. Don't understand how taxes are collected in the NHL (they're collected based on where you're playing games, so it's not 100% home)
2. Don't understand the different levels of how teams are taxed (teams like Tampa don't have "no taxes", they have no state income tax, which is a small portion of total taxes)
3. Don't understand that there is a cost of living difference between cities, one you can easily complain about not being included in the salary cap
4. Don't understand that there is a quality of life difference between cities, one you can easily complain about not being included in the salary cap
5. Don't understand that making a tax dependent salary cap is extremely complicated and puts pressure on government officials to make decisions based on sports, which is absolutely not what a government should be doing.

1. While thats true, this does not apply to signing bonuses, only their base salary. And teams that have no state income tax will have 50%+ of their taxed games come from the lowest possible rate.
2. There is still like an ~20% difference between no state income tax states and the cities with the highest tax rates. So believe it or not, there is quite a large difference.
3. Several of the cities with the highest tax rates also have the highest cost of living... So not sure what your point is here.

 

[CascadiaPuck]

1. While thats true, this does not apply to signing bonuses, only their base salary. And teams that have no state income tax will have 50%+ of their taxed games come from the lowest possible rate.
2. There is still like an ~20% difference between no state income tax states and the cities with the highest tax rates. So believe it or not, there is quite a large difference.
3. Several of the cities with the highest tax rates also have the highest cost of living... So not sure what your point is here.

Re: #3, the point is that high costs of living are also one of many variables (besides state/ provincial taxes) impacting take home pay.
Also, you should probably address points 4 and 5, as well as property tax or municipal tax differences between these regions, endorsement opportunity differences, a team's non-player salary expenditure differences (for scouts, trainers, various luxuries), etc.

The cap is the cap. Best to make peace with it. Most proposals to tweak it would make its enforcement and management much more complex, create more loopholes, etc.

 

[Peasy]

Re: #3, the point is that high costs of living are also one of many variables (besides state/ provincial taxes) impacting take home pay.
Also, you should probably address points 4 and 5, as well as property tax or municipal tax differences between these regions, endorsement opportunity differences, a team's non-player salary expenditure differences (for scouts, trainers, various luxuries), etc.

The cap is the cap. Best to make peace with it. Most proposals to tweak it would make its enforcement and management much more complex, create more loopholes, etc.

Having to pay less taxes is an advantage, simple as that. I don't get why people try to discredit it. It's just another factor that will come into consideration when negotiating a contract just like the hundreds of other factors.

 

[Canes]

Having to pay less taxes is an advantage, simple as that. I don't get why people try to discredit it. It's just another factor that will come into consideration when negotiating a contract just like the hundreds of other factors.

And playing in hockey markets or big markets is advantageous for endorsement deals. Should we police this too? Or just situations where it goes against those markets?

 

[Peasy]

And playing in hockey markets or big markets is advantageous for endorsement deals. Should we police this too? Or just situations where it goes against those markets?

Did you miss the part where I acknowledge there are hundreds of other factors that are considered as well?

Taxes influence a players contract and negotiation, just as do hundreds of other factors...

 

[Golden_Jet]

Having to pay less taxes is an advantage, simple as that. I don't get why people try to discredit it. It's just another factor that will come into consideration when negotiating a contract just like the hundreds of other factors.

Let’s get rid of signing bonuses as that’s a disadvantage, and give Canadian teams a break since there revenues are not US dollars.

 

[Legion34]

Can the cap be adjusted based on weather also? Teams from the north should have a larger cap to make it more even.

if by “adjusted” you mean.

completely artficially imposing a restriction on a business in a free Market. Then yes I’m sure they can make it fair.

the weather argument is dumb. The weather isnt artificially capped. Salaries are.

 

[Legion34]

Let’s get rid of signing bonuses as that’s a disadvantage, and give Canadian teams a break since there revenues are not US dollars.

sorry where does it say in the CBA other teams can’t give signing bonuses?


They can. They choose not to. They legally can

 

[Peasy]

Let’s get rid of signing bonuses as that’s a disadvantage, and give Canadian teams a break since there revenues are not US dollars.

Holy strawmans in this thread lmao.

Not once have I said every player and team should be taxed the same. Yet from all these responses, you would think that I did...

Literacy is hard apparently.

 

[Crede777]

The only thing the league may want to look at is a cap on signing bonuses (either a flat cap or a percentage of annual compensation). But that would only really benefit teams which are smaller market or cash poor. And the owners would have to give something up to the NHLPA to get it included in the CBA.

Outside of bonuses which are paid up front, state income tax is pretty negligible.

 

[NOTENOUGHJTCGOALS]

1. While thats true, this does not apply to signing bonuses, only their base salary. And teams that have no state income tax will have 50%+ of their taxed games come from the lowest possible rate.
2. There is still like an ~20% difference between no state income tax states and the cities with the highest tax rates. So believe it or not, there is quite a large difference.
3. Several of the cities with the highest tax rates also have the highest cost of living... So not sure what your point is here.

Aren't state taxes paid an itemized deduction?
So a player in a high state tax state pays the extra 20% on half the games played. But gets back 37 cents on every dollar of state tax paid.

 

[Golden_Jet]

sorry where does it say in the CBA other teams can’t give signing bonuses?


They can. They choose not to. They legally can

We’re discussing methods to make it more fair, not what gives teams more advantages to avoid paying taxes on income.

 

[Legion34]

We’re discussing methods to make it more fair, not what gives teams more advantages to avoid paying taxes on income.

no? We aren’t. It’s not about fair..... the cap was that.

It’s about a poorly constructed method of artificial constraint on some. That gives others a huge advantage

 

[Golden_Jet]

no? We aren’t. It’s not about fair..... the cap was that.

It’s about a poorly constructed method of artificial constraint on some. That gives others a huge advantage

Paying 95% in signing bonuses (paying 15% in taxes) on multiple contracts is not a huge advantage, and is not an artificial constraint on the majority of teams?

 

[txpd]

Not going to lie. I actually do think that there should be some sort of balance to make it a bit more even.

It first off has to be a reasonable amount.

Balance? A hockey player in NYC or Toronto or Chicago has high paying off ice opportunities often arranged for by the team. This is income not available in markets like Dallas and LA and Carolina. Balance. Right?

 

[Legion34]

Paying 95% in signing bonuses (paying 15% in taxes) on multiple contracts is not a huge advantage, and is not an artificial constraint on the majority of teams?

No?

1.) in a free market system. Businesses are allowed to pay their employees what they want

the CBA artificially imposes a cap on salaries. This is supposed to assist with parity. However, not accounting for tax advantages in different markets in this system leads to unfair advantages.

There are different financial rules In different markets that the NHL has not accounted for in the fake system.

there is no reason they have to account for weather or money or fans etc. They have chose to artificially control one factor. You have to make the “fair” system actually fair.

signing bonuses are equally legal and able to be used by every team the exact same way. The no tax teams maintain their advantages within the SB structure.

the fact that they choose not to does not mean it isn’t allowed. Teams can do it. They CAN spend the same. High tax teams CANNOT offer tax advantages.

 

[Legion34]

Balance? A hockey player in NYC or Toronto or Chicago has high paying off ice opportunities often arranged for by the team. This is income not available in markets like Dallas and LA and Carolina. Balance. Right?

it IS available. If they market the team and make it successful. There is NO cap on these opportunities. It’s not big Market teams fault those fans don’t care.

 

[SEALBound]

In short OP, no. Wanna seriously affect change? Vote differently.

That said, I think the fairest way is "post-tax salary" / years = cap hit.

 

[CascadiaPuck]

Having to pay less taxes is an advantage, simple as that. I don't get why people try to discredit it. It's just another factor that will come into consideration when negotiating a contract just like the hundreds of other factors.

I don't think anyone is discrediting it. Like you said, it is one of many, many factors. Heck, state/ provincial taxes aren't even the only tax factors. However, there are just so many threads dedicated to this one issue and far fewer dedicated to most of the other factors... combined. You don't see people advocating for crazy alarm clock protocols or extra time spent flying to counteract the travel advantages some teams have, for example. I think most people are just calling out how bizarre it is to focus so hard on this one topic - demanding it be somehow "fixed" - without considering the wider context.

 

[BruinsBtn]

From an NHL agent



So now all the people who are lying about NHLers in Toronto paying 50% taxes can shut up.

 

[Legion34]

From an NHL agent



So now all the people who are lying about NHLers in Toronto paying 50% taxes can shut up.

Unmmmmm that’s one agent? There are always people who disagree with the crowd. This is the same guy who just happens to have half his players in tax free markets...... suuuuure.

an agent who draws pictures knows more than a Harvard educated lawyer who has managed billion dollar companies for 30 years..... and is an American who works in Canada? Oookay

The RCA thing is a complete joke that completely screws over ability to invest or the value of front loading. Basically you have to lock up all your money. Not invest it and then move to a tax free state to retire. You can’t just do that. RCA are taxed before AND when you take them out. You also can’t make any income when you take them out.

There are multiple accountants, agents GMs and players who competely disagree. Tax 5 minutes to google and you will see multiple dissenting opinions.

In fact Louis gross has his staff make a spread sheet of every contract value and how much difference it makes across markets due to taxes.

But only 1 agent knows. The rest are wrong

 

[BruinsBtn]

Unmmmmm that’s one agent? There are always people who disagree with the crowd. This is the same guy who just happens to have half his players in tax free markets...... suuuuure.

an agent who draws pictures knows more than a Harvard educated lawyer who has managed billion dollar companies for 30 years..... and is an American who works in Canada? Oookay

The RCA thing is a complete joke that completely screws over ability to invest or the value of front loading. Basically you have to lock up all your money. Not invest it and then move to a tax free state to retire. You can’t just do that. RCA are taxed before AND when you take them out. You also can’t make any income when you take them out.

There are multiple accountants, agents GMs and players who competely disagree. Tax 5 minutes to google and you will see multiple dissenting opinions.

In fact Louis gross has his staff make a spread sheet of every contract value and how much difference it makes across markets due to taxes.

But only 1 agent knows. The rest are wrong

You're wrong and you didn't back up anything you wrote. This entire thread is a joke and this debate is stupidly misinformed. I'll take the public opinion of a major NHL agent over 'Legion34' and his nonsense.

 

[North Cole]

Disappointing article. Salary *marginal rate + jock tax is hilariously simplified and inaccurate.

The people who suggest making the salary cap have any tax dependence:

1. Don't understand how taxes are collected in the NHL (they're collected based on where you're playing games, so it's not 100% home)
2. Don't understand the different levels of how teams are taxed (teams like Tampa don't have "no taxes", they have no state income tax, which is a small portion of total taxes)
3. Don't understand that there is a cost of living difference between cities, one you can easily complain about not being included in the salary cap
4. Don't understand that there is a quality of life difference between cities, one you can easily complain about not being included in the salary cap
5. Don't understand that making a tax dependent salary cap is extremely complicated and puts pressure on government officials to make decisions based on sports, which is absolutely not what a government should be doing.

4) How much do you think living in a Canadian city with Provincial tax adds to your quality of life over living in Miami? I'd argue most players residing in Canada have it pretty good, on the bump they get from positive exposure to the USD/CAD rate.

5) A tax dependent cap has nothing to do with government officials and puts no pressure on them, its internal and contained to only the NHL. Players have pressure to make decisions on tax, not the other way around. That said I agree, the NHL doesn't need one and it's a dumb idea.

 

[Legion34]

You're wrong and you didn't back up anything you wrote. This entire thread is a joke and this debate is stupidly misinformed. I'll take the public opinion of a major NHL agent over 'Legion34' and his nonsense.

1.) you will take the opinion of a major public agent...... but not an NHL GM/president/league official? Why?

2.) you don’t have to take my word for it. You can find Louis gross agency interview on 31 thoughts. You can find multiple articles on the athletic from actual accountants who have NHL clients


3.) you can google RCA and see what it stands for. Hint.... it’s RETIREMENT. Just like an RRSP. You get taxed 20% at the time. Lock it up with no investments. Then you have to take it out as needed. You get taxed AGAIN based on your income bracket......

If a player has endorsement/businesses etc they get taxed on the RCA at that bracket. It’s an RRSP.

I have posted links for people who act like adults. Take 5 min to google. And either come back and apologize or Feel free to embarrass yourself further.