Should the NHL salary cap adjust for local income tax?

[Hatter of the Beach]

Can the NHL make each city the same level of desirability to live in while we're at it? Let's take Winnipeg and airlift all the land next to San Diego!

 

[Sypher04]

Every NHL city has its own pros and cons.

NY has some of the highest taxes in the NHL yet the Rangers are almost always a desirable destination for UFA's.

Perhaps a team like Dallas has much lower taxes but chances are they can't/won't spend to the cap.

Having an internal budget is an organization's choice (albeit based on their finances). State tax is an imbalance in the system. Not comparable.

 

[Sypher04]

Can the NHL make each city the same level of desirability to live in while we're at it? Let's take Winnipeg and airlift all the land next to San Diego!

It's pretty silly that people seem to wanna talk like it's the same problem. At all.

The income tax issue is a clear and measurable imbalance in the system; desirability is completely subjective.

A 10M cap hit should be worth the same value in TOR/MTL/LA/ANA etc as it is in FLA/TBL/NSH/LV etc

 

[IceNeophyte]

I would like to propose that Vegas and Arizona are allowed a hardship supplement to the cap, so they can pay players enough to live in a desert. Plus an added bump for Vegas because of the inflated cost of hookers and blow.

 

[Unspecified]

Then what about cost of living difference?

Vancouver, Toronto, New York, are a fair bit more expensive places to live in than say Buffalo.

Exactly, or like Dallas. In Dallas while the overall living expenses have gone up a fair amount over the last couple of years it is still on the lower end of the spectrum overall to the rest of the US. So Dallas would be screwed if this were to come into play.

 

[Sypher04]

Exactly, or like Dallas. In Dallas while the overall living expenses have gone up a fair amount over the last couple of years it is still on the lower end of the spectrum overall to the rest of the US. So Dallas would be screwed if this were to come into play.

How? If their living expenses are low now, they'd still be low if the NHL decided to find a way to level out the cap accounting for taxes.

 

[therealkoho]

Then what about cost of living difference?

Vancouver, Toronto, New York, are a fair bit more expensive places to live in than say Buffalo.

cost of living while it may certainly matter to people who have a total family income sub 200k, a number that really doesn't apply to professional athletes

 

[Unspecified]

How? If their living expenses are low now, they'd still be low if the NHL decided to find a way to level out the cap accounting for taxes.

Not having a state income tax is a slightest of advantages and having this bargaining piece that Dallas has is not the teams fault but rather the state. If it was such a large advantage like some seem to make it out to be then we would have a huge advantage in luring top players here which is not the case.

 

[Voight]

Dallas and Florida have no income tax.

It sucks seeing them sign all the top free agents.... such a huge advantage they have.

 

[Gnashville]

I'm sure some free agents probably do actually, even if they don't talk about it. It's naive to think they don't. It's not a myth simply because you don't believe it.

As for you second point, it's utter nonsense, this wouldn't change anything with how players are taxed by the government.

Name the ones that signed in Nashville or Florida?

Now if the cap was adjusted for every team then some governments would indeed raise taxes on the players and let the league adjust the cap for it. Never trust politicians to keep the hands out of people’s pockets.

 

[RandV]

Name the ones that signed in Nashville or Florida?

Now if the cap was adjusted for every team then some governments would indeed raise taxes on the players and let the league adjust the cap for it. Never trust politicians to keep the hands out of people’s pockets.

I'm pretty sure the Steven Stamkos $8.5M cap hit took tax dollars into effect when looking at offers?

As for the topic I'm not sure how much of an impact it would have but as long as cost certainty is maintained it certainly isn't something that would hurt to look into. I'd think it's less about certain teams getting an advantage for tax dollars and more other teams being negatively effected by the lower gross pay they have to offer. It's one thing if you're a marquee city like New York, but if you're an Ottawa that has to make it tougher. This would be more on the league to work out than the PA, but if it can be done without effecting their precious cost certainty it probably wouldn't hurt.

 

[SotasicA]

Finally some motivated citizens! Go vote and change the tax rates of your city/state/country, and make your home town hockey team competitive! Surely you'll all be happier if the mega rich pay less taxes. You can increase the tax rate of low income people to keep paying for all the necessary things you have in your city.

 

[Cor]

huh? We're talking about player income. Literally nothing here is relevant.

No, we're talking about income taxes.

 

[triggrman]

Players are taxes for the city they play in each night, not just the host city.

 

[No Fun Shogun]

I've said it before, I'll say it again...

If taxes were an overwhelming factor, how come we don't see a free agent rush to low tax states/markets like Dallas, Florida, Tampa, Carolina, and Nashville?

 

[Melrose Munch]

Primarily yeah, but people who think the only purpose is cost certainty are thinking too narrowly here imo.

The cap being created most definitely was also partly result of there being a wide divide between the haves and have nots of the league

I would say that while I agree with you, the cap has stopped the financial losses for most teams.

Although this would never happen, and taxes are a state, provincial, and or federal issue, it is frustrating.

The league went out of it's way to create parity, and I get why, but they totally neutered the advantages teams like NYR, MTL, and TML had when it came to being able to use it's financial might, and while we paid to help smaller southern markets on top of it.

Not saying we had proper management in place for years in Toronto when we could spend, but the smaller markets with great weather/less taxes have a clear advantage over the markets who basically built the NHL in the first place.

Not all markets should be or have been created equal. Everyone should be able to utilize their advantages.

I think anything you can do to sell the city to a prospective player is fair game, but the system itself should not basically have differing values of the cap in different locations. I concede it's a complex issue though, and I don't pretend to be the one with the answer on the best way to fix it.

Agreed

The complexity of trying to fix this would be too much for any league to want to consider tweaking.

I think cities should help themselves by selling what they have to offer, and should be able to fully supplement salaries with endorsement deal after endorsement deal.

Times have also changed, and with the type of money being made today, players want to live in warm climates with less tax. They also seem to value more privacy and financial stability as opposed to playing for legendary franchises.

I remember watching old time videos of how proud the players were to play for historic teams, times and priorities are just too different for todays athletes.

If I am an NHL player, I would want to win in a place like Toronto or Montreal over everything, you would be a god forever.

Guys want to be in Arizona, Florida, Carolina, Dallas. It is what it is.

 

[Melrose Munch]

I don't want to see a league where the southern markets and low tax states are the front and centre destinations, and the teams who literally built the NHL and are heritage franchises, are second rate.

I am not saying media wise that this is happening, or that it will indeed happen in general, but some franchises should be special and have real significance.

In saying that look at the knicks in the NBA lol but at least the players still recognize how special it is to play for the lakers, celtics, or knicks, and want to play there.

Regardless, this topic has a lot of variables, and all markets have so many factors to look at.

You have a problem with the no trade clauses and the media, not the cap.

 

[greasysnapper]

No, it starts a slippery slope. There are so many factors players use to decide where to go. Ya a team like Montreal has high taxes and New York has a high cost of living, but in general those teams with cons, have a lot of pros for the players too, one of which is local sponsorship and ad deals. Stamkos for example could have made more money in Toronto than Tampa despite the tax difference, but that probably came with added pressure, time commitments, and other things. There are so many factors, and that's what makes it great. Individual players can seek out what works for them.

 

[pbgoalie]

Hypothetical mystery player has the option of going to UFA:

TBL offers him 7x8.5
TOR also offers him 7x8.5

Over the course of that 7 year deal he would make $9,815,624 more in Tampa than he would in Toronto.

For the Leafs to match that deal they would have to increase their offer to just a sliver under 11.5 million per year

Did you include all the states/provinces where players pay state income tax as well??

 

[93LEAFS]

This isn't feasible for owners and makes them too subjective to local government changes if teams are paying in net.

It'd probably be simpler for the owners to just abolish the cap at that point.

 

[MLSE]

How do you deal with trades is my concern. I only read the first page, so maybe it was answered.

 

[tfong]

So how do you take into account tax credits and tax havens and shelters and such that probably most of these players use?

 

[glovesave_35]

Huh? This seems entirely wrong on the face of it. Being a proffesional athlete and more working visas might make a difference but isn’t it based upon company (team) location and home addresses with some different states having reciprocal agreements. For example, PA residents only paying PA taxes even though they work in MD.

You would be wrong. Sports and entertainment is unique.

 

[glovesave_35]

Cost of living isn't the problem. I've been very clear this whole time that I think cost of living has no place in this argument as it does not relate to the cap or taxes. This is for a number of reasons. 1) cost of living is what you do with your money AFTER you've made it, not what you make therefore it's outside the scope of the cap imo 2) cost of living is relative not only to state, or country, but the city as well... far too many variables. Point 1 however is really the beginning and ending of the argument though in my eyes.

I remain unconvinced that there even is a problem.

And your goal post being the actual money that comes into one's bank account but not how much that money buys in a locale seems arbitrary to me.

I'm from Dallas. I have lived in Sydney. The two cities offer many similar things and many different things. And I can assure you that cost of living is an equal part of the equation that taxes would be in choosing between the two as a residence. A million bucks buys you a huge house in DFW. In Sydney you would be looking at a very modest house about 30-40 minutes from downtown, a 3 bed 2 bath no lawn type.

You can bet that when these guys are making money decisions these things play into the thought process as much, if not more than taxes.

 

[Hynh]

It's pretty silly that people seem to wanna talk like it's the same problem. At all.

The income tax issue is a clear and measurable imbalance in the system; desirability is completely subjective.

A 10M cap hit should be worth the same value in TOR/MTL/LA/ANA etc as it is in FLA/TBL/NSH/LV etc

When the same two cities top the "least desirable" list repeatedly, I think you can connect the dots.