Should the salary cap be based on after tax salary

[Steve]

If the purpose is to truly have a level playing field then yes That being said, I believe it’s predominantly teams in the south that benefit from the tax structure ie Florida (but I could be wrong).

 

[JustaFinnishGuy]

Oh my god, teams like Florida have it too good! They're #28 in the NHL, if they didn't have this glaring advantage they would be behind a team like Ottawa, where the taxes are one of the highest in the NHL!

Clearly the most important problem the NHL has to think about.
Has there ever been a case of taxes actually shown to be impactful on on ice performance?

 

[Plural]

Absolutely not.

 

[WhiskeyYerTheDevils]

No.

Isn't it the whole idea of taxes that they exist to pay for services that in some way (either directly or indirectly) benefit the taxpayers? So shouldn't places with higher taxes offer a higher standard of living?

I feel like that's the sales pitch I always here when it comes time to raise taxes.

So the inequity in tax rates should be balanced out by a proportional difference in standard of living. Right?

 

[bleedblue1223]

Threads like this just confirm to me that the vast majority of people do not understand taxes and truly how complex they are.

 

[bleedblue1223]

No.

Isn't it the whole idea of taxes that they exist to pay for services that in some way (either directly or indirectly) benefit the taxpayers? So shouldn't places with higher taxes offer a higher standard of living?

I feel like that's the sales pitch I always here when it comes time to raise taxes.

So the inequity in tax rates should be balanced out by a proportional difference in standard of living. Right?

If you believe the government spends efficiently and effectively, then yes. If you don't, then what you say isn't necessarily true. Tax rates and standard of living are really up to the competency of the government and how you'd personally spend your own money in a low-taxed area.

 

[wintersej]

No. Do we start changing the cap in markets that have better marketing and endorsement opportunities? Dumb rabbit hole to start down.

 

[Mulletman]

Threads like this just confirm to me that the vast majority of people do not understand taxes and truly how complex they are.

That's true. Plus the players who get the big Money deals can afford the good lawyers, that can bend the truth so they don't pay much taxes anyway...

 

[bleedblue1223]

That's true. Plus the players who get the big Money deals can afford the good lawyers, that can bend the truth so they don't pay much taxes anyway...

Any system would have to be based on the nominal rates, not the effective rates, so it doesn't matter what the players actually pay in the end. Doing it based on their effective rates and true taxes paid would simply be impossible and the NHLPA would never allow it.

 

[wintersej]

If you believe the government spends efficiently and effectively, then yes. If you don't, then what you say isn't necessarily true. Tax rates and standard of living are really up to the competency of the government and how you'd personally spend your own money in a low-taxed area.

And it kinda depends on which state you are in. Some states (whether high tax or low tax) get a much better ROI on taxes collected than others. I have a lot more to say here, but it will go off topic into politics and be deleted by mods . All in all, tax rates are so so so so overblown when it comes to professional athletes. They make enough money that the 50% of games they play at home being different taxes doesn't matter nearly as much as a vast array of other factors. I mean, if you were rich, would you rather be rich in LA/NY/Tor and pay high taxes or rich in Alabama and pay very low taxes?

 

[bleedblue1223]

And it kinda depends on which state you are in. Some states (whether high tax or low tax) get a much better ROI on taxes collected than others. I have a lot more to say here, but it will go off topic into politics and be deleted by mods . All in all, tax rates are so so so so overblown when it comes to professional athletes. They make enough money that the 50% of games they play at home being different taxes doesn't matter nearly as much as a vast array of other factors. I mean, if you were rich, would you rather be rich in LA/NY/Tor and pay high taxes or rich in Alabama and pay very low taxes?

Exactly, something that most people don't understand is that players aren't paying 100% of their state/local taxes to the state/locality of where the team they play for resides.

Any quality of life increase is typically aimed at low and middle class. Few people in the top tax bracket are taking advantage of public provided services. In some cases, of course, but not anywhere close to the same extent. New York isn't a great location for the rich because of their high taxes, and the services provided through that tax revenue.

 

[wintersej]

Exactly, something that most people don't understand is that players aren't paying 100% of their state/local taxes to the state/locality of where the team they play for resides.

Any quality of life increase is typically aimed at low and middle class. Few people in the top tax bracket are taking advantage of public provided services. In some cases, of course, but not anywhere close to the same extent. New York isn't a great location for the rich because of their high taxes, and the services provided through that tax revenue.

New York is an awesome place to be rich, though. Lots of best of the best things to spend your money on and lots of other rich people to hangout with. I'd also point out that people in the upper bracket certainly benefit from their employees having access to a good public school/university system, etc. Anyway, gets back to the point that trying to account for tax differences and not a litany of other things when talking about the salary cap is bonkers.

 

[PerdFan]

It's a cop out. Turris signed in Nashville with no trade protection. So it wasn't about the tax break.

Exactly. So I guess we'll have to now take into account that Tennessee has the highest sales tax in the nation at 9.46% to 9.75%. Also Tennessee taxes on investments. Let's not forget that there is also a "professional sports tax" of $2,500.00 (with an annual cap) per game per player. Schools are good, but not the best. Housing costs are skyrocketing every year because of the popularity of the city. So tell us again how much advantage Nashville has? If you're going to take state income tax into account, then you have to take all the rest of the financial disadvantages into account also.

 

[bleedblue1223]

New York is an awesome place to be rich, though. Lots of best of the best things to spend your money on and lots of other rich people to hangout with. I'd also point out that people in the upper bracket certainly benefit from their employees having access to a good public school/university system, etc. Anyway, gets back to the point that trying to account for tax differences and not a litany of other things when talking about the salary cap is bonkers.

It is a great place to be rich in, I'm just saying it doesn't really have much to do with the taxes. For taxpayers in the top bracket that are employers, I agree. Then again, Kansas has a stupid tax code that has been a disaster and Blue Valley is one of the best school districts in the country, so it just depends on how the localities spend and execute. But, that's enough off-topic, and we agree anyway.

 

[tony d]

No, it shouldn't.

 

[bobermay]

Too many moving parts for my liking. How would you trade players if their cap hits changed drastically upon switching teams?

What if players cap hits don't change... what if there was an adjustment based on each team.

So, NHL teams like TBL and FLA would have a lower cap allowance, and teams with high taxes like SJS, ANA, CGY, LAK have a little more wiggle room...

So that a team like TBL/FLA have a max cap limit of ~78 mil, and teams that players get more heavily taxed have a max cap limit of ~83 mil.

I must confess that I'm confounded why the teams in "low tax areas" aren't piling up Stanley Cups if it's such a big competitive advantage.

You'd be kidding yourself if you think taxes doesn't influence player decisions and contract demands. Players can gain > 10% in income when traded from high taxed provinces/states to low taxed ones.

 

[bleedblue1223]

You'd be kidding yourself if you think taxes doesn't influence player decisions and contract demands. Players can gain > 10% in income when traded from high taxed provinces/states to low taxed ones.

If this were actually true, you'd see all the lowed-taxed areas hoard talent across professional sports. The fact is, the top players make so much money, that taxes don't factor into the decisions in any significant way.

 

[Phil Kessels Hot Dog]

players get paid per game, and taxed based on where the game takes place

Something like 95% of Stamkos contract is being paid in Florida due to bonuses and it's around 75% for Ekblad. I imagine Kucherov will get a deal similar to Stamkos as well.

 

[b1e9a8r5s]

What do you think Stamkos' endorsement opportunities are in Tampa? What would they have been had he gone to Toronto? Should the cap account for that too?

 

[Maukkis]

What if players cap hits don't change... what if there was an adjustment based on each team.

So, NHL teams like TBL and FLA would have a lower cap allowance, and teams with high taxes like SJS, ANA, CGY, LAK have a little more wiggle room...

So that a team like TBL/FLA have a max cap limit of ~78 mil, and teams that players get more heavily taxed have a max cap limit of ~83 mil.

Then you will face a situation in which the teams in states with the lowest tax rates suffer, for they would operate under a significantly lower cap than other teams.

 

[bobermay]

Then you will face a situation in which the teams in states with the lowest tax rates suffer, for they would operate under a significantly lower cap than other teams.

Howso? The goal of adjusting cap hits to each city is to even the playing field even more. Currently some cities have financial benefits over others.

No way would the Steven Stamkoses, Viktor Hedmans, Johnsons, Kucherovs, etc have re-signed for the same money on other teams...

 

[bleedblue1223]

Howso? The goal of adjusting cap hits to each city is to even the playing field even more. Currently some cities have financial benefits over others.

No way would the Steven Stamkoses, Viktor Hedmans, Johnsons, Kucherovs, etc have re-signed for the same money on other teams...

And some markets have cheaper housing or more lucrative endorsement deals. You can adjust for everything, and if you adjust for one thing, it will be incredibly flawed.

 

[Voight]

No because some states/provinces have higher tax rates than others. States like FLA & TX have no income tax where as California has the highest. Would give an unfair advantage.

 

[bobermay]

And some markets have cheaper housing or more lucrative endorsement deals. You can adjust for everything, and if you adjust for one thing, it will be incredibly flawed.

I'd argue it already IS incredibly flawed.

You're right, its never going to be perfect... but I think it can be less flawed than it is now...

 

[pheasant]

I think a lot of players are looking for a contract at a certain number for the status of it. Not all NHL players, mind you. But some aren't concerned about their paycheque looking different when negotiating betweeen 5.9 and 6.1 million dollars. But they negotiate it anyway. Because the number is a sign of success. Tthey are thinking about other players salaries, and how the number compares.

So the difference in take home because of tax is sometimes irrelevant. Some players care more about the pre-tax number, not after-tax.