An idea to level the playing field for the new cba in regards to tax rates in different cities.

[Newsworthy]

I feel the state income tax situation is overblown.

 

[Hoek]

There was an article about the Tavares signing that basically described how they blew it with Stamkos and it had nothing to do with the tax situation but rather an aggressive pitch that may have piled too much pressure on him. Has there really been a signing since that has really made people think, "Hmm it must've been the taxes" ? In any case I haven't heard of a solution to this that is actually palatable to any of the actors involved and isn't convoluted as hell, nor have I heard any complaints in other leagues about tax disparities.

 

[Inkling]

The disparity in taxes is just one factor in overall compensation. Opportunities for endorsements, commercials and sponsorships are going to be bigger in a large hockey market like Toronto versus a minor-hockey market like Arizona. Are you going to account for that too? There are lots of things that make the finances unequal between NHL cities.

 

[No Fun Shogun]

There was an article about the Tavares signing that basically described how they blew it with Stamkos and it had nothing to do with the tax situation but rather an aggressive pitch that may have piled too much pressure on him. Has there really been a signing since that has really made people think, "Hmm it must've been the taxes" ? In any case I haven't heard of a solution to this that is actually palatable to any of the actors involved and isn't convoluted as hell, nor have I heard any complaints in other leagues about tax disparities.

Essentially, no. It basically boils down to "[insert player] should come to [insert poster's favorite team here]... wait he chose to go/stay with [insert other team here that's probably better than the aforementioned team] instead? Their city/province has a lower tax rate, that must be why!" It is a vast oversimplification of the many reasons why a free agent may wish to choose one market over another and disregards the many factors at play as they are not deemed as potentially easily correctable.

 

[drewjenks]

We literally just had an offseason where the most sought after free agent took a smaller salary offer from a team in a higher taxed city than a larger offer from a team in a lower taxed city. Taxes are a factor that players consider, but Tavares is the ultimate example that it's not the only or primary factor in player heads.

You are highly incorrect sir.

I won't explain it all to you....but basically....John Tavares will be paying Florida (any state he chooses) tax rates on his earnings in Toronto because there is a related Canada / US tax treaty (basically all he has to do it buy a house in Florida & rent a house in Toronto).

Pretty simple stuff - but not possible if he hadn't lived in the USA 10 years.

So yes - taxes are unfair & it played into Johns decision (Cali tax was worse).

 

[No Fun Shogun]

Interesting caveat if that is the case, but if it is then you essentially torpedoed almost any argument for many veteran free agents seeking a major contract. That would mean that Canadian teams have a leg up seeking veteran players than had previously played in the US and inherently invalidates the potential argument for making taxes something that could be account for in the salary cap if there are factors like that at play. And if there's a loophole like that in place, then there are almost assuredly other loopholes in place as well to minimize tax payments for other circumstances as well.

 

[NorthCoast]

Interesting caveat if that is the case, but if it is then you essentially torpedoed almost any argument for many veteran free agents seeking a major contract. That would mean that Canadian teams have a leg up seeking veteran players than had previously played in the US and inherently invalidates the potential argument for making taxes something that could be account for in the salary cap if there are factors like that at play. And if there's a loophole like that in place, then there are almost assuredly other loopholes in place as well to minimize tax payments for other circumstances as well.

Here is the info on Tavares taxes.

The more I have looked into this the more I am convinced that yes, taxes for sure play a factor when a few percentage points can equal millions of dollars over the coarse of a 7-8 year deal.

However, the Tavares situation is also a prime example of why a standard policy would be almost impossible simply because there are WAY too many variables to account for because of all the tax loopholes available to players based on two countries, many different states/provinces, working in every state/province throughout the year, offseason residences, front-loaded/back-loaded, bonus vs salary, etc, etc.

At the end of the day, the priority should be on improving revenue sharing instead of worrying about taxes. Because taxes should only play a role if all other things are equal. Therefore, start by making all other things equal and then worry about taxes.