Salary Cap (Taxes)

[Legion34]

Boston and Calgary aren't tax free and have all of their guys on great deals, maybe Toronto just has poor management

nope. Look again. They all seem to make sense
within the general construct.

Boston:
1.) Marchand signed a year before he broke out.
2.) pasta was well within his comparables of 8-9.25%
3.) krecji was 11% as a 19g 50-60pt C
rask got PAID.

in fact Chara was the highest cap percent D in league history. At 17.05%. That’s Crosby money.

Boston has had an incredible team with muted stats until the last couple of years. They have been great in structure but we haven’t seen a “top” line player sign with them. They all became as such. Which is lucky for them. But it’s different.

The last time it happened. They signed the biggest contract for D in history.

2.) same with Calgary. Last time they had a player with top stats up for contract it was gaudreau. Who got the highest RFA % of all of his comparables.

 

[Legion34]

Your contradictions and jumps to conclusions are fascinating.

Aho chooses Montreal over Carolina. Doesn’t matter. Gardiner chooses Carolina after being in the microscope of Toronto and it’s proof. Players sign in Tampa for less. It’s proof! Tavares signs in Toronto for less. Doesn’t matter. Panarin signs in NY instead of Florida. Is Benn playing for low 13% of cap with no taxes in Texas out of line with Tavares at high 13%? The taxes **** is just so so so so so overblown. If it wasn’t, in all the sports Texas and Florida would dominate. And across all the sports they don’t even come close to higher tax places like Boston or California.

1.) aho didn’t choose one over the other? He didn’t sign with Montreal for less. Gardiner did sign for less.

2.) the proof has been demonstrated by agents. GMs. Accountants and players. The advantage is exactly what it is. Because that’s how math works.

no matter what. If a player signs for X in Tampa. They have to sign for more to make the same money. It’s a simple fact.

some rare instances players can choose to take less. Sure. But it doesn’t change the advantage.


there is more that goes into making a champ than. Tax breaks. But It is an advantage. Your last point is pretty foolish. I mean

NYR and TOR won 1 cup in a combined 100 years with all the money in the world. So what. That means that having unlimited spending wasn’t an advantage? I mean. Come on. If budget matters
Wouldn’t they have more cups?

 

[Bocephus86]

@Legion34 I think you've fallen hard into a common issue: having a conclusion before viewing the facts & circumstances, thus you put additional weight into criteria/facts that backup your point and go out of your way to explain away or ignore facts that are opposed to your conclusion. This happens to a lot of people. It's happening here.

There are a million factors that go into a decision on where to play and what contract a player wants (taxes included, but I'd wager generally not the number 1 factor for most players, and for likely only a handful of players would it be the only factor, if that). Some players want night life, some quiet life, some want to stay near home, some want weather, some want to be famous, others want anonymity, some care about competing, some want to be team leaders, others want to fit into existing culture, etc. They take their individuals desires, look at the teams offering them contracts, and pick the place that fits their 'want matrix' best. Players are humans. While hockey is very important in their lives, they do have lives outside of the rink.

You've decided taxes are the only factor because you are mad about some contracts your team recently signed. I'm sorry about that, but you are clearly starting with a conclusion and focusing on facts that fit your preconceived position.

 

[Legion34]

@Legion34 I think you've fallen hard into a common issue: having a conclusion before viewing the facts & circumstances, thus you put additional weight into criteria/facts that backup your point and go out of your way to explain away or ignore facts that are opposed to your conclusion. This happens to a lot of people. It's happening here.

There are a million factors that go into a decision on where to play and what contract a player wants (taxes included, but I'd wager generally not the number 1 factor for most players, and for likely only a handful of players would it be the only factor, if that). Some players want night life, some quiet life, some want to stay near home, some want weather, some want to be famous, others want anonymity, some care about competing, some want to be team leaders, others want to fit into existing culture, etc. They take their individuals desires, look at the teams offering them contracts, and pick the place that fits their 'want matrix' best. Players are humans. While hockey is very important in their lives, they do have lives outside of the rink.

You've decided taxes are the only factor because you are mad about some contracts your team recently signed. I'm sorry about that, but you are clearly starting with a conclusion and focusing on facts that fit your preconceived position.

huh? Not at all. I have come to this conclusion and have been assisting people understand the tax issue for years. Well prior to any “contracts that have recently been signed”


It has been a well known issue with probably 100 articles by agents. GMs. Coaches. Players and tax professionals.

the tax advantages are very clear and finite.

It is obvious that players will choose to weight this advantage as they see fit. Family weather etc will all assist with decisions. Tavares went to a high tax city for his wife to work. Trouba wanted to go to NYR for his.

JS Giguere wanted to be near hospitals that could treat his son...... all those things are possible.

but regardless. The tax advantage is still present. And it clearly is a factor. You can see low tax teams getting better deals.

 

[Neutral Hockey Fan]

I was told all the leaf players would take hometown discounts because the endorsement money in Toronto “puts all other cities to shame” (words of leaf fans on the leaf board), and “the amount the leaf players make in endorsements is more than they lose in taxes compared to players in Tampa” (another common leaf board theory). If the contracts those RFA’s signed is them “giving a big team friendly discount” then LOL at dubass.

The only fanbase complaining consistently about taxes is the fan base that has a rookie GM willingly giving players ridiculous contracts.

Imagine signing 3 contracts in the span of a couple months that make all 3 players the 2nd, 3rd, and 6th highest paid players respectively in the world at the time of the signings? That’s abysmal management

 

[Neutral Hockey Fan]

I still get a kick out of the threads about “all the other big RFA’s signing for the same, or more than Marner once dubass gives him a fair deal”. Fast forward a couple weeks and Tkachuk, Laine, Point, Aho, Rantanen, ect all make significantly less than Marner.

You’d think shanahan would step in at some point to help his rookie from getting slaughtered at the negotiation table so consistently?

 

[LeafsNation75]

I was told all the leaf players would take hometown discounts because the endorsement money in Toronto “puts all other cities to shame” (words of leaf fans on the leaf board), and “the amount the leaf players make in endorsements is more than they lose in taxes compared to players in Tampa” (another common leaf board theory). If the contracts those RFA’s signed is them “giving a big team friendly discount” then LOL at dubass.

The only fanbase complaining consistently about taxes is the fan base that has a rookie GM willingly giving players ridiculous contracts.

Imagine signing 3 contracts in the span of a couple months that make all 3 players the 2nd, 3rd, and 6th highest paid players respectively in the world at the time of the signings? That’s abysmal management

Do I wish Marner signed for less than what he got, it would have been nice had that happened. However I feel more comfortable paying him compared to the $7.14 million AAV the Flyers gave Kevin Hayes. In fact Hayes AAV is more than Nylander's $6.9 million AAV and Nylander was already a better player and still is today.

 

[Neutral Hockey Fan]

Do I wish Marner signed for less than what he got, it would have been nice had that happened. However I feel more comfortable paying him compared to the $7.14 million AAV the Flyers gave Kevin Hayes. In fact Hayes AAV is more than Nylander's $6.9 million AAV and Nylander was already a better player and still is today.

So comparing an RFA contract to a bad UFA contract is meaningful...how? If anything, as you have already said, it’s actually a testament to how truely bad dubass has been with his signings. “Well, ya it’s a bad contract, but at least it isn’t as bad as (insert bad UFA deal here).” Good point you made. Cheers

 

[Your Boy Troy]

Well, that's too bad. This is what happens when you have socialist policies.

 

[Hockey Outsider]

It's shocking how many misconceptions about personal income tax have been posted in this thread. Domestic taxation is complicated enough, it becomes that much more convoluted when you're looking at cross-border planning.

I think each of the following three statements are true:

1. Unless you're a tax accountant or tax lawyer with at least 3-5 years of experience dealing with international taxation, you're not qualified to make the conclusions that people are confidently posting throughout this thread.
2. Income taxes can significantly affect take-home pay, potentially to the tune of hundreds of thousands of dollars if you're talking about a multi-million dollar annual salary.
3. Income tax is one of many factors that isn't (and realistically can't be) controlled for - such as proximity to family, amenities and entertainment options within a city, intensity of media coverage, weather, etc.

 

[Michel Beauchamp]

You have posted this and been proven wrong many times. A total league cap on salaries is related to HRR

that all teams have the same cap is for parity.

as long as 50% of salaries go to the players. Big market teams could have a higher cap and cost certainty would still be achieved

Unless I'm badly mistaken, it's the first time I posted that the salary cap was instituted to insure cost certainty.

The rest of the post makes no sense.

 

[Michel Beauchamp]

maybe because they know more?

Very funny.

Keep on doing... whatever you're trying to do.

 

[DistantThunderRep]

1.) that’s not how it works. Signing bonuses are not taxed where you cash the cheque. Otherwise every team could book a hotel in florida and pay everyone there.

Matthews as 1 example could maintain residency for a little bit and get some savings. But ultimately it will end up the same. There are also risks to SB.

2.) no one is saying that every playet only signs in low tax states. Of course not. What is being said is that

to offer the same player the same net value. High tax teams have to offer substantially more. Which is a systemic disadvantage.

montreal toronto and ottawa have to offer I think it’s 1.5 million more on a 10’millon AAV.

Signing bonuses are taxed in your residence. Matthews is a US citizen and a resident of Arizona. He's right and you're wrong.

 

[Legion34]

Unless I'm badly mistaken, it's the first time I posted that the salary cap was instituted to insure cost certainty.

The rest of the post makes no sense.

you haven’t made this argument in other threads?

sure it does. If the goal of the cap is cost certainty not parity. Then there is nothing that says that all teams would have the same ceiling.

Just like the budget on a team. The team has an allotment of 81.5 million to spread on 23 players.

there is nothing that says all players make the same. They don’t. There is no parity in player salaries.

but there is institutional parity among teams by having them all have same Max budgets

 

[supsens]

I was told all the leaf players would take hometown discounts because the endorsement money in Toronto “puts all other cities to shame” (words of leaf fans on the leaf board), and “the amount the leaf players make in endorsements is more than they lose in taxes compared to players in Tampa” (another common leaf board theory). If the contracts those RFA’s signed is them “giving a big team friendly discount” then LOL at dubass.

The only fanbase complaining consistently about taxes is the fan base that has a rookie GM willingly giving players ridiculous contracts.

Imagine signing 3 contracts in the span of a couple months that make all 3 players the 2nd, 3rd, and 6th highest paid players respectively in the world at the time of the signings? That’s abysmal management

First they need a luxury cap, then and tax break, then all the power plays because everything is so unfair for the poor poor leafs

 

[LeafsNation75]

So comparing an RFA contract to a bad UFA contract is meaningful...how? If anything, as you have already said, it’s actually a testament to how truely bad dubass has been with his signings. “Well, ya it’s a bad contract, but at least it isn’t as bad as (insert bad UFA deal here).” Good point you made. Cheers

I used Hayes UFA contract as an example because his career high for points in a season is 49. Nylander's career high is 61 points which he's done 2x. I realize one was an RFA and the other would have been a UFA if the Flyers never traded for his rights, however it was dumb to say Nylander was overpaid when you look at it from that logic.

 

[Neutral Hockey Fan]

Signing bonuses are taxed in your residence. Matthews is a US citizen and a resident of Arizona. He's right and you're wrong.

Bingo. And considering he’s making half a billion dollars, or whatever it is, in signing bonuses, his $700,000 salary is taxed based on where he plays. Meaning, a guy like Matthews is actually taxed LESS than guys in Florida and other places. How can you not understand this? It’s not that complicated

 

[ScaredStreit]

There is a difference, but it's overstated. When people bring up income tax they always forget to bring up endorsements, cost of living, etc.

 

[Michel Beauchamp]

https://en.wikipedia.org/wiki/NHL_salary_cap.
You seem pretty confident about the cost certainty thing but “ Like many professional sports leagues, the NHL has a salary cap to keep teams in larger markets (with more revenue) from signing all of the top players and extending their advantage over smaller-market franchises.“

1. Wikipedia ? Really ?

2. That might be a side effect, but it was to insure cost certainty.

 

[Legion34]

Signing bonuses are taxed in your residence. Matthews is a US citizen and a resident of Arizona. He's right and you're wrong.

Nope. Matthews has to claim residency in Arizona. He has to be able to maintain residency and argue it. He has played in Toronto and worked in Canada for 3 years prior to the contract. The year before he worked in Switzerland. He played hockey for the development team before that.

It would depend on many factors. How many days he lived in Canada vs us. Whether he has property. Cars etc in Canada. It may be difficult for a guy who may have literally never held a job in Arizona to claim residency for tax purposes

This has all been discussed in the athletic article I have posted. About 30 times.

He can claim it every year. And he runs the risk of back taxes. it’s possible. But it’s not as simple as well as “buy a condo in Florida” boom tax free.

Tavares could have claimed residency in the states and claimed his big bonus the first year. That’s true. Matthews is possible. But more complicated

according to tax professionals. Players who play in the state’s who sign in Canada generally claim us residency for a year or 2. Then become “canadian” for taxes.

 

[Neutral Hockey Fan]

I used Hayes UFA contract as an example because his career high for points in a season is 49. Nylander's career high is 61 points which he's done 2x. I realize one was an RFA and the other would have been a UFA if the Flyers never traded for his rights, however it was dumb to say Nylander was overpaid when you look at it from that logic.

If you actually wanted to use logic, why not use comparable RFA contracts? Oh, right. You’ve already said, the multiple $10.5+ million RFA contracts dubass has signed players to don’t compare favourably to the RFA deals literally every other GM has negotiated. You were correct on that one.

Not sure why you are bringing up UFA deals, especially when I have already agreed with your notion that dubass has butchered his salary cap with his poor negotiation with his young RFA’s

 

[Neutral Hockey Fan]

There is a difference, but it's overstated. When people bring up income tax they always forget to bring up endorsements, cost of living, etc.

Or the fact that players in Toronto get paid in US dollars and everything they pay for in Toronto is in Canadian dollars. Huge, HUGE advantage to Toronto

 

[LeafsNation75]

If you actually wanted to use logic, why not use comparable RFA contracts? Oh, right. You’ve already said, the multiple $10.5+ million RFA contracts dubass has signed players to don’t compare favourably to the RFA deals literally every other GM has negotiated. You were correct on that one.

Not sure why you are bringing up UFA deals, especially when I have already agreed with your notion that dubass has butchered his salary cap with his poor negotiation with his young RFA’s

Since Nylander was an RFA brining up his contract is still correct because him getting a $6.9 million AAV is not an overpayment by Dubas, even though a lot of other non Leafs fans said it was.

 

[Neutral Hockey Fan]

Since Nylander was an RFA brining up his contract is still correct because him getting a $6.9 million AAV is not an overpayment by Dubas, even though a lot of other non Leafs fans said it was.

Are you lost? Honestly.

It’s about the multiple $10.5 million - almost $12 million contacts dubass has handed out that compare very unfavourably to ALL other comparable RFA contracts in the nhl, which you have already agreed with. Good on you for pointing this leaf GM issue out earlier.

 

[Krewe]

If this was a politics forum /topic I'd think some people in this thread were paid shills at this point. The last time a no-tax team won the Stanley cup was 2004. Assuming all teams have an equal chance at the cup the expected numbers of cups won by no-tax teams should be 1.45 since then. If this is really such an advantage, then why have teams in areas with higher taxes done so much better? California has 3 cups in the lockout era, despite having the highest taxes in the US.

Even more so, why do fans care how much their players make. On the list of reasons behind a teams performance, taxes rates and contract sizes is far below things like drafting, GM, Coach, etc etc etc