Orange
Registered User
Talent doesn't follow a linear fonction, neither do salaries. I don't see why a luxury tax system should. Maybe it would be simpler for fans to understand, but I don't see think it helps the league that much. Here's my plan for a luxury tax :
Definitions :
SM : Salary Mass. A single team's total salary paid out during the year.
LT : Luxury Tax. Amount paid over a certain excess.
USM : Updated Salary Mass. A team's salary with luxury tax included. USM = SM + LT
AS : Average Salary. Average player salary for the season.
BM : Base Mass. Average base salary mass. BM = AS * 22 (for a 22 men roster).
So here goes : USM = SM*1.01^([SM-BM]/AS)
This formula is based on compound interest calculations and would be very stiff on high spenders ! Basically, it gives a little room to go over the league's average salary mass but is too punitive to go way over it. The 1.01 factor is arbitrary and would be up for debate.
Here are some numbers to crunch. Let's assume AS = 1.55 (with a rollback). BM would be set at 34.1. All numbers are in millions.
SM ---- USM ---- LT ----- LT.75 --- LT.2
34.10 _ 34.10 ___ 0.00 ___ 0.00 ___ 0.00
40.00 _ 43.13 ___ 3.13 ___ 4.43 ___ 1.18
50.00 _ 61.26 ___ 11.26 __ 11.93 __ 3.18
60.00 _ 83.53 ___ 23.53 __ 19.43 __ 5.18
70.00 _ 110.74 __ 40.74 __ 26.93 __ 7.18
80.00 _ 143.80 __ 63.80 __ 34.43 __ 9.18
To compare, I've inlcluded what a .75/dollar and .2/dollar luxury tax over the first 34.1M would amount to. With a 1.01 "rise factor", we can see that my "non linear" luxury tax system approximates a .75/dollar luxury tax at 40M and 50M but starts getting more punitive at 60M. Obviously, the parameters of the equation are up for debate. Most notebly the raise factor (set a 1.01 for the example) and the BM which realy equates to how much the players are ready to roll back salary (I used the 24% figure in this example).
What do you people think ? Fire away !
Definitions :
SM : Salary Mass. A single team's total salary paid out during the year.
LT : Luxury Tax. Amount paid over a certain excess.
USM : Updated Salary Mass. A team's salary with luxury tax included. USM = SM + LT
AS : Average Salary. Average player salary for the season.
BM : Base Mass. Average base salary mass. BM = AS * 22 (for a 22 men roster).
So here goes : USM = SM*1.01^([SM-BM]/AS)
This formula is based on compound interest calculations and would be very stiff on high spenders ! Basically, it gives a little room to go over the league's average salary mass but is too punitive to go way over it. The 1.01 factor is arbitrary and would be up for debate.
Here are some numbers to crunch. Let's assume AS = 1.55 (with a rollback). BM would be set at 34.1. All numbers are in millions.
SM ---- USM ---- LT ----- LT.75 --- LT.2
34.10 _ 34.10 ___ 0.00 ___ 0.00 ___ 0.00
40.00 _ 43.13 ___ 3.13 ___ 4.43 ___ 1.18
50.00 _ 61.26 ___ 11.26 __ 11.93 __ 3.18
60.00 _ 83.53 ___ 23.53 __ 19.43 __ 5.18
70.00 _ 110.74 __ 40.74 __ 26.93 __ 7.18
80.00 _ 143.80 __ 63.80 __ 34.43 __ 9.18
To compare, I've inlcluded what a .75/dollar and .2/dollar luxury tax over the first 34.1M would amount to. With a 1.01 "rise factor", we can see that my "non linear" luxury tax system approximates a .75/dollar luxury tax at 40M and 50M but starts getting more punitive at 60M. Obviously, the parameters of the equation are up for debate. Most notebly the raise factor (set a 1.01 for the example) and the BM which realy equates to how much the players are ready to roll back salary (I used the 24% figure in this example).
What do you people think ? Fire away !