Let’s even the playing field…after tax payroll cap

VivaLasVegas

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Jun 21, 2021
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Oh look, this thread again with a different title.
I was fully expected it in the offseason, but it came early this year.

This would be like the U.S. teams complaining that the Leafs have a huge advantage because there is nothing else to do in Toronto and thus the Leafs are forced to spend their time concentrating on hockey.
 
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Jul 10, 2003
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Was it reported that it was due specifically to taxes? Maybe he likes TB weather. Maybe he didn't want to play infront of the media circus that is Toronto. Maybe those things were why toronto came with a higher price tag.

Sounds like having a bunch of high profile people that have nothing to do with hockey (toronto mayor / canadian tire CEO) at their sales pitch had something to do with it.

Not too often a player comes out and says he choose a team for better tax rates or more money, not a great look for them.

He was probably just using Toronto in an effort to get Tampa to up their offer Imho.
 

Captain97

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Jan 31, 2017
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The more I learn about this stuff the more impossible I realize it is. For starters tax loopholes on residency and bonuses, followed by Charitable donations, being taxed differently based on what city the game is played in, the 50/50 revenue split.

It isn't feasible, we have to learn to accept it. And my team is affected the most negatively (quebec has highest tax rates) + we play Ottawa and Toronto a ton etc.

After the accounting shenanigans the difference is nowhere near as much as people make it out to be.
 

Lil Sebastian Cossa

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I think the tax situation helped, but even moreso Yzerman got the players to buy into a "team friendly" culture regarding contracts. Actually, that's a really misleading term. Instead of "team friendly," It should be called a "win friendly" culture. Much easier to create a winning culture and feel a part of something when guys are all sacrificing for each other.

Yep. It's what guys like Yzerman, Chelios, Shanahan, etc. did in 2002 also. There wasn't a cap, per se, but guys on that team of superstuds surrendered really immaterial amounts from each of their contracts to clear the board for the Wings to bring in Brett Hull and Luc Robitaille.

He got the Tampa guys to buy into give up a little bit of money to keep this thing together and you'll win... a lot.
 

zodiacbiller

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By no means is rantanens extension great, but when you look at the cap picture of both teams it's not as bad, the avs could absorb overpaying him to keep him while they have a contention window.
Mackinnon doesnt even make 7.0, and landeskog makes 7.5. It looks bad in the sense that he's making more than mackinnon, or the guy wearing the C while not being the best player on the team, but he did sign after those guys also.

It's rumored macK is willing to take another team friendly deal, and maybe sakic knew that when he gave rantanen that deal.

What? Rantanen's contract is good. He makes almost $2MM less than Marner, who's of basically equivalent value. My point is that there wasn't a huge media shitstorm about getting Rantanen's contract done the way there was with Marner's.
 

LaCarriere

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Not too often a player comes out and says he choose a team for better tax rates or more money, not a great look for them.

He was probably just using Toronto in an effort to get Tampa to up their offer Imho.


Maybe he was trying to leverage more money, but that information came from nhl executives apparently, not Stamkos. The fact that the mayor was there and business executives certainly sounds like a plausible reason he wanted nothing to do with the circus that is Toronto, not money. I'm not sure what the Mayor would be there for anyways, it's not like they needed someone to pitch him the city, he's from Markham.

I'm sure he was well aware of the endorsement opportunities that would come with playing in Toronto, likely why canadian tire CEO was at the meeting, but maybe he wanted to just focus on hockey. Only Stamkos knows for sure, but that scenario is certainly plausible, and it's hard to argue he made the wrong choice.
 

SomeDude

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There are hundreds of ways for wealthy people to avoid paying taxes. Players have agents and financial advisors who specialize in minimizing their tax liability.

Allan Walsh, probably the most vocal player agent in hockey, is on record (when he was on chiclets) saying it's not hard for players to avoid paying the higher taxes in certain cities. Sometimes that involves stashing some money away for a few years, but for the big ticket players that is not an issue.

Players choose not to sign in some cities/markets for a lot of reasons, but taxes are just what fans blame it on. Most players don't want to play in Canada because of the crazy media/pressure/fans/weather, etc.
 

dlawong

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Wife factor - beaches, weather, crime rates, shopping options, and most importantly, a nice place to raise a family. If the wife is in the entertainment business (such as modeling or acting, then California and NY probably will be a favorable choice)

Player factor - if young, money > cup, if older and have not won a cup, then SC > money, if won cup at a younger age, likely a raise would be the focus. Endorsements opportunity also matters.

Family factor - if the player or wife has very few siblings, then likely would want to return to a location close to home, to attend to parents, especially matters more if married with young children

Ownership matters - strong ownership and a reputable front office can definitely attract players and that is something most agents will highly recommend for their clients.

Teammates/Coach factor - strong connection can sway a decision, same as team culture (especially with international players who do not speak English well)

Privacy concern factor - some may value this more than others and it could influence the decision

Travel Schedule concerns - this especially matters for older players who hate too much long-distance travel that can wear their bodies down faster

Media concerns - too much negativity for one to handle? Of course, it would depend on the players. I would expect most players can handle the pressure.

Overall - security likely will be the biggest factor, salary is important, but the contract term matters even more. Teams with a chance to win SC has the magnet in general, but may not be a factor each time. If the player owns a local business that requires considerable personal attention or has family members with ongoing health problems, they may just choose to stay put.

The last factor - is the fans. You would think that they should value their customers first, however, the only time the fans matter is if they show up constantly (ie high attendance records). Thus smaller markets have less chance to attract established stars.

As far as the state tax, it can have an impact on signing players, but the college UFA loophole also does as it allows these UFA to choose their destination based on opportunity for bigger roles or if they had a great desire to play for a certain team. It makes it easier for certain teams to land talented players early in their careers without even having to draft them.
 

nbwingsfan

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Not a coincidence that the states with no income tax are consistently icing teams that excel:

Tampa Bay Lightning
Florida Panthers
Las Vegas
Dallas

Also not a coincidence that Canadian teams, with a much higher income tax rate aren’t coming close to winning a Stanley Cup, a 29 year drought.

Time for the NHL to even the rather lopsided playing field and consider after tax income when setting the payroll cap
You and I have very different definitions of “consistently”…. How many times have Florida and Dallas made the playoffs?
 

nbwingsfan

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So why did Stamkos sign for 8.5 after fielding offers of 10 on the open market.

Vasilevsky takes 9.5 after Price gets 10.5.

Pretty sure Kucherov settled for 9.5 after the Matthews and McDavid contracts.

Point took 9.5 after Marner’s 10.9 with less term.

Hedman has a 7.875 cap hit.
Because they bought unto the team?

Why did Tavares sign for $11M when offered $13M

Why did Rielly sign for $8M when Nurse is getting $9.5M?

Why did Simmonds, Gio and Spezza sign for league minimum when better offers were out there?
 

Yackiberg8

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Why has Toronto got many team friendly deals?

Why did the Wings always get team friendly deals?

Why did Crosby, Malkin, Letang always get team friendly deals?

Why so the Bruins always get amazing deals?
In my other post I explained that the state tax is a large factor among other factors that go into this decision. I know a couple of prominent players on the Panthers and can confirm that it was for them. It is much easier to take a team friendly deal in that tax situation.

The Leafs do not get team friendly deals unless you are talking about 40 year old players taking league minimum?

Crosby and Malkin were tied for 2nd highest paid in the league when they signed. Letang is going to be priced out this year because he wants too much money.

The Bruins were lucky enough to sign their key players before they broke out. Pastrnak is potentially being traded this off-season because he wants too much money. You think MacKinnon took a team friendly deal in Colorado I bet too.

There is nuance to everything.
 

NewEraGM

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Not a coincidence that the states with no income tax are consistently icing teams that excel:

Tampa Bay Lightning
Florida Panthers
Las Vegas
Dallas

Also not a coincidence that Canadian teams, with a much higher income tax rate aren’t coming close to winning a Stanley Cup, a 29 year drought.

Time for the NHL to even the rather lopsided playing field and consider after tax income when setting the payroll cap
This is such BS and such an overused argument. You can make the case that Canadian team players get paid in USD but spend in CAD. There’s a 20% difference right there…also big market Canadian teams can front load their deals which many of the teams you listed can’t do…

Also there are tons of tax tricks for European players as well that almost make it even. Several articles have been written on this by player agents
 

nbwingsfan

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In my other post I explained that the state tax is a large factor among other factors that go into this decision. I know a couple of prominent players on the Panthers and can confirm that it was for them. It is much easier to take a team friendly deal in that tax situation.

The Leafs do not get team friendly deals unless you are talking about 40 year old players taking league minimum?

Crosby and Malkin were tied for 2nd highest paid in the league when they signed. Letang is going to be priced out this year because he wants too much money.

The Bruins were lucky enough to sign their key players before they broke out. Pastrnak is potentially being traded this off-season because he wants too much money. You think MacKinnon took a team friendly deal in Colorado I bet too.

There is nuance to everything.
Tavares literally signed for $2M less than he could have got in SJ. The age of torontos players is irrelevant if they’re signing for less than market value to play for that team.

Crosby and Malkins second major contracts were very clearly massive discounts. Letang is only getting priced out now because Pittsburgh is on the downswing too.

Do you not think Tampa and Florida have had players price themselves out?

Detroit had a ton of players sign well below market value when they were the best franchise in the league

Finally, yes I’m sure you know a ton of high profile NHLers well enough that they speak about their financials with you. Doesn’t at all seem made up!

Players sign for a million different reasons, taxes I’m sure being a reason for SOME. But if you’re going to start complaining about that, then you better start changing the rules for Toronto getting Toronto born players, NYR getting guys because it’s NY, LA because it’s LA, etc
 

Golden_Jet

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So Kucherov had offers from other teams? I think he was lying because he has never hit Free Agency to know what his market was. (This was pointed out, regarding Stamkos, by another Lightning poster - see the following post)



In order for Kucherov to make the same amount of money as he does today playing for a team, like say the Toronto Maple Leafs, he would have to earn an AAV of $12,037,790… and CapFriendy does account for the fact players are taxed differently when they team they are playing for are in the road.

In order for Kucherov to net out the same amount as he would playing for the Toronto Maple Leafs as he would playing for the Tampa Bay Lightning, he would have to be paid a significantly greater salary.



Nikita Kucherov…

Tampa Bay Lightning - $9,500,000 AAV Gross Earnings = $5,623,465 Net Income

Toronto Maple Leafs - $9,500,000 AAV Gross Earnings = $4,444,154 Net Income

Toronto Maple Leafs – $12,037,790 AAV Gross Earnings = $5,623,465 Net Income
Doesn’t work like that, Kuch only pays 15% tax on signing bonus part.

Look at Matthews , 95% is signing bonus, so pays 15% tax on 95% and the 52% on the last 5%.
This is for non Canadians playing in Canada.
 

THE HOFF

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Sep 26, 2007
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Considering the number of teams in the US that are litterally kept alive by canadian contributions to the NHL vault, the least you can do is have the discussion. Seems like a decent chuck of US fans cherry pick when capitalism actually applies for them.

There is a team that could win a 3rd stanley cup in a row that struggles to post a net operating income. Let that sink in.
 
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WeatherBeaten

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Mar 4, 2019
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Doesn’t work like that, Kuch only pays 15% tax on signing bonus part.

Look at Matthews , 95% is signing bonus, so pays 15% tax on 95% and the 52% on the last 5%.
This is for non Canadians playing in Canada.
Where is the 15% idea coming from? In the US, supplemental income is taxed at ordinary rates . There are different withholding requirements for bonuses but all are higher than 15% and that doesn’t change the tax due, just the amount withheld by the employer. Why would they pay only 15% on a signing bonus?
 
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Golden_Jet

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Sep 21, 2005
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Where is the 15% idea coming from? In the US, supplemental income is taxed at ordinary rates . There are different withholding requirements for bonuses but all are higher than 15% and that doesn’t change the tax due, just the amount withheld by the employer. Why would they pay only 15% on a signing bonus?
Shouldn’t of included Kuch, as not sure on him, but definitely for Matthews. Being US playing in Canada, it’s been covered a lot in here,
He could use RCA’s as an example.
@mouser can probably explain it better than me.
 

Jumptheshark

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Oct 12, 2003
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Not a coincidence that the states with no income tax are consistently icing teams that excel:

Tampa Bay Lightning
Florida Panthers
Las Vegas
Dallas

Also not a coincidence that Canadian teams, with a much higher income tax rate aren’t coming close to winning a Stanley Cup, a 29 year drought.

Time for the NHL to even the rather lopsided playing field and consider after tax income when setting the payroll cap
can you give me Vegas playoff stats this year-----
 

Church Hill

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Nov 16, 2007
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Many players have spoken about taxes as a deciding factor on podcasts, for example, but a larger factor is quality of life in the chosen city. I mean, if you're honest with yourselves, would you rather live in Florida or... Literally anywhere in Canada? Choice is easy if you don't have family in either place.

(blah blah blah politics)
 

Yackiberg8

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Mar 11, 2016
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Tavares literally signed for $2M less than he could have got in SJ. The age of torontos players is irrelevant if they’re signing for less than market value to play for that team.

Crosby and Malkins second major contracts were very clearly massive discounts. Letang is only getting priced out now because Pittsburgh is on the downswing too.

Do you not think Tampa and Florida have had players price themselves out?

Detroit had a ton of players sign well below market value when they were the best franchise in the league

Finally, yes I’m sure you know a ton of high profile NHLers well enough that they speak about their financials with you. Doesn’t at all seem made up!

Players sign for a million different reasons, taxes I’m sure being a reason for SOME. But if you’re going to start complaining about that, then you better start changing the rules for Toronto getting Toronto born players, NYR getting guys because it’s NY, LA because it’s LA, etc
It’s not talking detailed personal financials. I asked each of these players specifically if state taxes are a factor in their contract negotiations and each of them said that they were definitely a factor.

I also have not complained about the taxes just pointing out that it is clearly a factor in certain scenarios. One of those scenarios being the Lightnings top players all signing for discounts.
 

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