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

[Bizz]

Abolish taxes.

 

[PlayersLtd]

We've established you keep more of your paycheck in the 6 markets without state tax. On top of that, there are other draws that make it even more compelling. But yes, no tax teams have an advantage.

You keep more of your paycheque yes, you also spend more of your paycheque on the same basket of luxury goods in a major US city as you do in any Canadian city.

Curious what Canadian cities you come up and visit? I compare Vancouver (T-1st most expensive Canadian city) with Seattle multiple times per year and every time I end up wondering how it's humanly possible that things have become so expensive in that city and its surroundings. It blows Vancouver out of the water.

I reiterate, from a financial perspective, a pro athlete is not coming out ahead signing in most if not all US markets. The taxes only tell a part of the financial story.

But yes, you are 100% correct, there are other draws. Nobody ever said the weather in your beloved Florida relative to that of Winnipeg was not a major selling point.

 

[danktopshelf]

You keep more of your paycheque yes, you also spend more of your paycheque on the same basket of luxury goods in a major US city as you do in any Canadian city.

Curious what Canadian cities you come up and visit? I compare Vancouver (T-1st most expensive Canadian city) with Seattle multiple times per year and every time I end up wondering how it's humanly possible that things have become so expensive in that city and its surroundings. It blows Vancouver out of the water.

I reiterate, from a financial perspective, a pro athlete is not coming out ahead signing in most if not all US markets. The taxes only tell a part of the financial story.

But yes, you are 100% correct, there are other draws. Nobody ever said the weather in your beloved Florida relative to that of Winnipeg was not a major selling point.

Only been to Toronto and Quebec City north of the border. And that was before so many things in the world changed from 2020 onward. I don't recall things being that much cheaper, but at the time CDN was damn near USD. If anything, I thought both were spendy, but granted, stayed at luxury hotels etc.

 

[Menzinger]

It's too complicated because peoples tax situations are very different. The only way to potentially offset it by allowing teams to spend more money via a luxury tax system

 

[Dr Robot]

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.

1) That doesn’t mean anything, that’s just basic due diligence.
2) According to the Buffalo GM he also uses Palm Tree advantages. Paying a few % more or less is an incredibly minor selling point.
3) Id like to see the math on that as it barely works in theory. Depending on the year/residency the top effective tax rate might not even have been 14% and that’s before other mitigators like playing half your games in other states.
4) Show me how you determined that UFA are signing for less because of taxes.

Your free agent example also doesn’t prove they decided to sign in those locations because of taxes instead of literally any other reason.

Most of your points are you just attributing everything that’s happening to taxes without proving proof. As playersltd pointed out, the effective tax rate between teams is fairly similar due to travel. If someone says the ultimate decider for them was making 6% more money in Tennessee then sure but that’s just one of any number of reasons and not nearly worth reworking the entire CBA and salary cap over.

 

[peconcan]

Do u really think Gary would want to give Toronto or Montreal hell and Canadian team an advantage?

 

[Mr Nogatco]

Loser talk. The shitty big market franchises that can’t keep up always have some combination of boat anchor contracts, terrible asset management, inept drafting, and/or dinosaur coaches. Should probably focus on those things before worrying about state taxes

 

[StammerHammer]

It's such a shame that teams from taxed states haven't won any cups since the no tax state teams have joined the league. The discussion of this thread would make more sense if this statement were true.

 

[Hextallent63]

Give it a rest already. Any team that has bought a player out, traded for a dead contract or just made dumb signings affect it more then this "tax difference". No shit agents are gonna make a mountain out of a molehill. All players pay taxes where they play on any given game night in any given city. I'm a flyers fan, if a team is shitty and can't get their shit together, it has nothing to do with taxes. If you think you team is so affected, look at your GMS, coaches, presidents and players. f***ing waaaambulance needs to turn the lights and siren off and park it.

 

[justus the great]

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.

Tell me you've never paid taxes in your life without telling me you've never paid taxes in your life.

 

[M88K]

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.

Maybe they could just not vote for ridiculous taxes? Seems like an easy thing to fix, don't like higher taxes don't vote for them. No reason to exempt the people who should be taxed the most because they play a game for a living.

Nashville has sucked for 30yrs how come their tax advantage doesn't work?


Likewise you start trying to adjust for taxes and then you have to adjust for endorsements too.

It's not like states like Texas don't make up for a lack of state income tax in other ways

 

[Legion34]

1) That doesn’t mean anything, that’s just basic due diligence.
2) According to the Buffalo GM he also uses Palm Tree advantages. Paying a few % more or less is an incredibly minor selling point.
3) Id like to see the math on that as it barely works in theory. Depending on the year/residency the top effective tax rate might not even have been 14% and that’s before other mitigators like playing half your games in other states.
4) Show me how you determined that UFA are signing for less because of taxes.

Your free agent example also doesn’t prove they decided to sign in those locations because of taxes instead of literally any other reason.

Most of your points are you just attributing everything that’s happening to taxes without proving proof. As playersltd pointed out, the effective tax rate between teams is fairly similar due to travel. If someone says the ultimate decider for them was making 6% more money in Tennessee then sure but that’s just one of any number of reasons and not nearly worth reworking the entire CBA and salary cap over.

1.) basic due diligence with different numbers. The numbers work out very differently in different states
2.) a few percent less or more is millions of dollars.
3.) capfriendly actually had a tool where you could make up a contract (included sb) and it would show you the take home difference. It’s massive
4.) you can research yourself. It’s all available.

Compare star players in high tax markets that were winners and had great weather (California teams) big markets (Chicago/nyr) and Canadian teams. You will find that the no state tax players all signed for 10-12.5% aav vs the others which all signed for 13.5-14.5

Compare: barkov. Tkachuk. Reinhart. Bob. Stamkos. Kuch. Hedman. Point. Vasy. Josi. Saros. Guentzel. Forsling Etc.

Vs
Karlson. Doughty. Tavares. Price. Sheshterkin. Trouba. Matthews. Peterson Nylander. Marner Kane. Toews.

You will see for yourself that no state tax players sign for less than comparable markets in size. Scope. Weather competitiveness.

Heck maybe ask chat gpt. I have done this a million times

 

[qcal1427]

Loser talk. The shitty big market franchises that can’t keep up always have some combination of boat anchor contracts, terrible asset management, inept drafting, and/or dinosaur coaches. Should probably focus on those things before worrying about state taxes

Yep. This and the playoff format stuff is just a convenient way for people to whine and deflect from their team just not being good enough

 

[LaffyTaffy13]

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.

Small market teams benefitting is bad for the leagues bottom line. Whats better for the league financially, NYR/LAK cup or Florida/Vegas cup?

 

[LaffyTaffy13]

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.

14% is a big number. Youre talking about Florida being able to spending around $13-14mm more on players than NYR for example. $14mm gets you alot player wise in the nhl

 

[edevils]

Eliminate state income taxes.

 

[Bank Shot]

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.

They get taxed regressively. It hurts the poor more than the rich.

But back to the point I don't see why they can't make the Cap based on estimated take home pay to balance the Cap for all teams.

I mean you can never equalize for desirable markets in terms of prestige, travel, fan pressure or weather but equalizing the monetary part of the cap seems pretty easy to do.

 

[Legion34]

You keep more of your paycheque yes, you also spend more of your paycheque on the same basket of luxury goods in a major US city as you do in any Canadian city.

Curious what Canadian cities you come up and visit? I compare Vancouver (T-1st most expensive Canadian city) with Seattle multiple times per year and every time I end up wondering how it's humanly possible that things have become so expensive in that city and its surroundings. It blows Vancouver out of the water.

I reiterate, from a financial perspective, a pro athlete is not coming out ahead signing in most if not all US markets. The taxes only tell a part of the financial story.

But yes, you are 100% correct, there are other draws. Nobody ever said the weather in your beloved Florida relative to that of Winnipeg was not a major selling point.

Except that’s not what NHL agents players gms and accountants say.

So honest question. Why do star no state tax players sign for less than high tax market? And why do the take home pays work out as similar/the same?

Seems kind of coincidental that all the no state tax star players take less?

Barkov/tkachuk/reinhart/bob/kuch/stamkos/hedman/guentze etc take less than Kane/toews/doughty/panarin/igor/preoce

 

[Legion34]

To go back to the equalization. It’s easy.
They could divide HRR cap between teams differently to equalize the advantage

 

[LaffyTaffy13]

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 are telling me if the Rangers could spend an additional net effective $14 million on players that it just simply wouldn’t make a difference? Wild take if so

 

[BLNY]

Make the salary cap based on net income. Problem solved.

 

[SPV]

As a Boston fan, I’ll agree it’s not a solid argument. The reason we missed the playoffs this year was hardly because of taxes. If the salary cap is really supposed to be to even competitive advantage, then I think the net income idea works. Ideally the solution is for rich people to pay taxes, but I’m afraid that’s a political commentary, even though it’s just my opinion.

 

[Shockmaster]

The Leafs and Rangers would still find ways to not win.

 

[TGWL]

Do you actually care or are you just bitter that NYR can't get players to take a discount with cost of living being so high, and youre frustrated with them over-spending and handing out clauses like candy?

 

[Commander Clueless]

Relocate all teams to the States without income tax.