What is the solution to balancing the salary cap with no tax states?

[LaffyTaffy13]

It’s becoming a big problem that the NHL has to be worried about. The NHL’s smallest TV markets are able to spend in some cases 15%+ more than large market teams.

Take Panthers vs Rangers for example.

Between NY state tax and NY city tax, the rangers roster for the same exact salary takes home about 15% less than floridas roster.

1) will the nhl allow a “tax allowance” to make everyone have the same net effective ceiling?

2) is it politically palatable for states and cities like ny/nyc to exempt athletes from state and city income tax? IMO it’d be deeply popular from constituents to do so.

 

[Hippasus]

Put all the forgone costs into a pot and redistribute the salary cap amongst the teams.

 

[UnSandvich]

It’s becoming a big problem that the NHL has to be worried about. The NHL’s smallest TV markets are able to spend in some cases 15%+ more than large market teams.

Take Panthers vs Rangers for example.

Between NY state tax and NY city tax, the rangers roster for the same exact salary takes home about 15% less than floridas roster.

1) will the nhl allow a “tax allowance” to make everyone have the same net effective ceiling?

2) is it politically palatable for states and cities like ny/nyc to exempt athletes from state and city income tax? IMO it’d be deeply popular from constituents to do so.

"2) is it politically palatable for states and cities like ny/nyc to exempt athletes from state and city income tax? IMO it’d be deeply popular from constituents to do so."

f*** no. If I have to pay my taxes, making a hell of a lot less money, the poor little millionaires can pay theirs too.

 

[Ghost of Murph]

People who live in states with no personal income tax get taxed in other ways. I live in a state with a very low state income tax but our overall tax burden is greater than that of Massachusetts, which is regarded as a state with high taxes.

 

[Lafleurs Guy]

It's not going to change.

 

[Drumman44]

The salary cap exists for one reason: to keep player salaries low(er). And small market teams benefiting disproportionally is going to be seen as a good thing in Bettman’s eyes.

 

[A1LeafNation]

They don't care so it won't be fixed.

You could evaluate each year and do cap relief percentages based on state/provinces...but they won't.

They only way it actually changes is when fans stop watching or going to games.

 

[FissionFire]

This is a fan-made problem. The salary cap doesn’t exist to create a level playing field, it exists to hard cap the percentage of revenues that players can get. It’s working perfectly and nothing needs to be tweaked. Competitive balance never was and never will be of any concern to the cap.

Also keep in mind higher tax areas also tend to have more chances and more lucrative income opportunities outside of playing games, like endorsements.

 

[1989]

Oh boy, another one of these threads.
Taxes are not the reason Team A sucks and Team B does well.

Players want to play in winning environments AND get paid fairly. If your front office can make it happen, UFAs and drafted players alike will be happy.

Weird how these threads never account for the lack of dynasties / playoff success in general from perceived "tax haven states" until very very recently. Recency bias at its best; since a hard cap was implemented 20 years ago, you'd think the accountants and agents of NHL players would have pushed for moves to Florida and Washington ASAP. For heaven's sake, Florida had TWO teams and still sucked for a long time.

 

[Idiot Stick]

Florida for 30 years of tax advantages doin f*** all

 

[eojsmada]

Players go to franchises that are lined up for Cup runs. Just watch all the older guys and where they go to, for one last shot at a Cup. If your team isn't one of the top 5 or 6 in the league, stop thinking of yourself as a destination for Free Agents.

 

[PlayersLtd]

It’s becoming a big problem that the NHL has to be worried about. The NHL’s smallest TV markets are able to spend in some cases 15%+ more than large market teams.

Take Panthers vs Rangers for example.

Between NY state tax and NY city tax, the rangers roster for the same exact salary takes home about 15% less than floridas roster.

1) will the nhl allow a “tax allowance” to make everyone have the same net effective ceiling?

2) is it politically palatable for states and cities like ny/nyc to exempt athletes from state and city income tax? IMO it’d be deeply popular from constituents to do so.

This is the biggest misconception in the league and it needs to disappear. The best tax state (SEA) relative to the worst tax state/province (MTL) results in a 6.4% difference in taxes paid. I did the math based on each teams schedule.

Why? Because you pay tax in the jurisdiction you are playing in so 41 games for Montreal are taxed at a lower rate and 41 games for Seattle are taxed at a higher rate, which closes the gap.

Now (for the Canada argument), imagine you are a pro athlete living in Canada and earning in USD. Your USD go so much further in Canada than they do in the US it quite easily offsets the 6.4% difference. A cocktail at a nice restaurant in a big US city exceeds $25 these days, that's $35 Canadian, for a drink... A burger and a beer in a big US city is $40.00 which is $55.00 Canadian. This is saying nothing about real estate, luxury cars and the likes, all more expensive in most big US cities.

Add to this that in Ontario (for one) there are tax incentives for athletes (RCA's) that help to level the playing field. Those that want to manage their salaries intelligently can quite easily offset the 6.4%.

So yeah, it's a non issue. Any pro athlete (or agent) that boils it down to taxes is being shockingly narrow minded, which I suppose shouldn't surprise anyone.

 

[Legion34]

People who live in states with no personal income tax get taxed in other ways. I live in a state with a very low state income tax but our overall tax burden is greater than that of Massachusetts, which is regarded as a state with high taxes.

NHL players aren’t living paycheque to paycheck. They are banking the vast majority to live like kings for 50 years after retirement.

no one is buying thousand dollar toothpaste to make up cost of living/local tax differences.

NHL players Agents gms and owners talk about the tax savings in no state tax states

 

[Dr Robot]

The oilers weren’t paying any state taxes last night. The Dallas stars will be filling a Canadian tax return because of their game tomorrow. This is a fan made problem to try and excuse their bad teams. Every time someone with an accounting degree explains that it’s not the issue you think it is, people cover their ears and start yelling “it’s still a problem”.

 

[danktopshelf]

This is the biggest misconception in the league and it needs to disappear. The best tax state (SEA) relative to the worst tax state/province (MTL) results in a 6.4% difference in taxes paid. I did the math based on each teams schedule.

Why? Because you pay tax in the jurisdiction you are playing in so 41 games for Montreal are taxed at a lower rate and 41 games for Seattle are taxed at a higher rate, which closes the gap.

Now (for the Canada argument), imagine you are a pro athlete living in Canada and earning in USD. Your USD go so much further in Canada than they do in the US it quite easily offsets the 6.4% difference. A cocktail at a nice restaurant in a big US city exceeds $25 these days, that's $35 Canadian, for a drink... A burger and a beer in a big US city is $40.00 which is $55.00 Canadian. This is saying nothing about real estate, luxury cars and the likes, all more expensive in most big US cities.

Add to this that in Ontario (for one) there are tax incentives for athletes (RCA's) that help to level the playing field. Those that want to manage their salaries intelligently can quite easily offset the 6.4%.

So yeah, it's a non issue. Any pro athlete (or agent) that boils it down to taxes is being shockingly narrow minded, which I suppose shouldn't surprise anyone.

You're missing a MASSIVE piece. Guys like Barky and Chucky are paid league minimum salaries and all of their pay in the form of signing bonus. So 90% of their money is in a tax free jurisdiction.

 

[Legion34]

This is the biggest misconception in the league and it needs to disappear. The best tax state (SEA) relative to the worst tax state/province (MTL) results in a 6.4% difference in taxes paid. I did the math based on each teams schedule.

Why? Because you pay tax in the jurisdiction you are playing in so 41 games for Montreal are taxed at a lower rate and 41 games for Seattle are taxed at a higher rate, which closes the gap.

Now (for the Canada argument), imagine you are a pro athlete living in Canada and earning in USD. Your USD go so much further in Canada than they do in the US it quite easily offsets the 6.4% difference. A cocktail at a nice restaurant in a big US city exceeds $25 these days, that's $35 Canadian, for a drink... A burger and a beer in a big US city is $40.00 which is $55.00 Canadian. This is saying nothing about real estate, luxury cars and the likes, all more expensive in most big US cities.

Add to this that in Ontario (for one) there are tax incentives for athletes (RCA's) that help to level the playing field. Those that want to manage their salaries intelligently can quite easily offset the 6.4%.

So yeah, it's a non issue. Any pro athlete (or agent) that boils it down to taxes is being shockingly narrow minded, which I suppose shouldn't surprise anyone.

1.) signing bonuses get paid in your local
Jurisdiction. So the stars are all getting taxed
At 37% instead of 55%

2.) nhl agents, players, coaches, GMs and accountants have repeatedly said it is an issue. You don’t get to decide it’s not.

 

[danktopshelf]

1.) signing bonuses get paid in your local
Jurisdiction. So the stars are all getting taxed
At 37% instead of 55%

2.) nhl agents, players, coaches, GMs and accountants have repeatedly said it is an issue. You don’t get to decide it’s not.

Nailed it. This guy, lol

 

[Legion34]

The oilers weren’t paying any state taxes last night. The Dallas stars will be filling a Canadian tax return because of their game tomorrow. This is a fan made problem to try and excuse their bad teams. Every time someone with an accounting degree explains that it’s not the issue you think it is, people cover their ears and start yelling “it’s still a problem”.

Except NHl accountants agents and GMs have publicly stated is IS an issue.

So what some random fan who pretends to have an accounting degree says is not relevant

 

[Dr Robot]

Except NHl accountants agents and GMs have publicly stated is IS an issue.

So what some random fan who pretends to have an accounting degree says is not relevant

Point me to where they say this is an issue and show me the math they are doing.

 

[danktopshelf]

Except NHl accountants agents and GMs have publicly stated is IS an issue.

So what some random fan who pretends to have an accounting degree says is not relevant

You'd have to be deaf, dumb and blind to believe it's not an issue. Proof is in the pudding. Good weather + low taxes + girlfriends/wives/family not heckled + nobody caring if you're in a slump + desirable city to be a super wealthy ripped young dude = winning. Miami/Broward beats the piss out of Calgary. Ask Huberdeau.

 

[Fatass]

It’s becoming a big problem that the NHL has to be worried about. The NHL’s smallest TV markets are able to spend in some cases 15%+ more than large market teams.

Take Panthers vs Rangers for example.

Between NY state tax and NY city tax, the rangers roster for the same exact salary takes home about 15% less than floridas roster.

1) will the nhl allow a “tax allowance” to make everyone have the same net effective ceiling?

2) is it politically palatable for states and cities like ny/nyc to exempt athletes from state and city income tax? IMO it’d be deeply popular from constituents to d

You honestly believe these million dollar athletes, who pay their agents as much as they do, don’t have equally well payed accountants?

 

[danktopshelf]

You honestly believe these million dollar athletes, who pay their agents as much as they do, don’t have equally well payed accountants?

You really believe those same agents/tax consultancies/attorneys aren't telling them that it is NOT super favorable to be with a jurisdiction without income tax when their clients are by and large high school dropouts earning 10s of millions of dollars? There's a huge reason Canadian teams + Buffalo have to pay extra for their guys and are always the 8 teams on No Trade Lists.

 

[JaegerDice]

It’s becoming a big problem that the NHL has to be worried about. The NHL’s smallest TV markets are able to spend in some cases 15%+ more than large market teams.

Take Panthers vs Rangers for example.

Between NY state tax and NY city tax, the rangers roster for the same exact salary takes home about 15% less than floridas roster.

1) will the nhl allow a “tax allowance” to make everyone have the same net effective ceiling?

2) is it politically palatable for states and cities like ny/nyc to exempt athletes from state and city income tax? IMO it’d be deeply popular from constituents to do so.

Wait, you think in THIS political environment, it would be POPULAR for members of the top 1% to pay less tax?

Lol

The tax issue is completely overblown.

Florida and Texas have had lower taxes for a long time, and yet the Panthers, Lightning and Stars werent hot spots for the bulk of the cap era.

Players are going their now not only for the tax benefits, but because they’re well run organizations with a good chance to win.

This ‘tax issue’ is nothing more than whining from fans of less well run teams.

 

[Ghost of Murph]

NHL players aren’t living paycheque to paycheck. They are banking the vast majority to live like kings for 50 years after retirement.

no one is buying thousand dollar toothpaste to make up cost of living/local tax differences.

NHL players Agents gms and owners talk about the tax savings in no state tax states

But they and their families do rent or own expensive housing, drive expensive vehicles, go out to eat, buy all sorts of things, pay local taxes, etc. All heavily taxed in some states. Anyway, most states that have state income taxes keep them fairly low aside from a few exceptions

It all balances out in the end for the most part. Most players have bigger priorities when choosing a team than state income taxes. If it was such a big deal then pro teams of all sports in states with no income taxes would be winning most championships.

 

[Legion34]

Point me to where they say this is an issue and show me the math they are doing.

Good lord. Sorry but this has been going on for years. I can’t keep going back and finding all the articles.

1.) Lewis gross (Nylanders agent) firm went on 32 thoughts and said they give their players a spreadsheet and it shows them the taxes and take home salary in. Each jurisdiction

2.) this year Tampa GM literally said he uses tax advantages

3.) radulov said he signed in Dallas vs
Montreal due to tax rate

3.) Marc Méthot said he took home 700k more a year on a 4.9 salary moving from Ottawa to Dallas. Jeff Petrys agent even said there was a difference in Montreal vs Edmonton

4.) low tax market ufas sign for 11-12%
Of the cap vs comparable players in comparable markets (weather/winning) vs high tax which generally are 13.5-14.5

There was an athletic article where an NHL accountant walked through scenarios (Canadian playing in Canada/us, eurpean and American).

This year all of the top free agents signed in state tax free states. Guentzel. Reinhart. Montour. stamkos. Marchy. Skej. Stephenson.

There are tons of examples. If you google for 10 minutes. You will find them.