Should teams salary cap be based on taxable income in that location?

[Jumptheshark]

the first mistake MANY are making in this discussion is that EVERY team has their business listed in their home state or province they play in and that ALL players have their CITY listed as their prime residence

this is where my crazy comes in handy--at one point in time I owned houses in 3 different countries and had my main address in a 4th( houses lost in a divorce) and so I, with the help of ex-wife number 2 and her accountant--figured out how to work the tax system to our advantage

TOO MANY POSTERS ON THIS THIS SITE DO NOT UNDERSTAND THE MULTIPLE JURISDICTIONS laws when it comes to living, playing and primary residance when it comes to paying taxes

 

[McJadeddog]

The biggest problem with this notion is that the cap isn’t about creating a level competitive playing field. It is about cost certainty for the owners. Whether a player takes home 80% of their check or 45% of their check it is going to cost the owner of the team the same amount. Whether that is in Florida or California.

Agreed. I don't actually think the NHL cares about parity all that much. They care about making money for the owners. My points are based of "IF" the NHL cared about fairness, they would implement a tax-based-cap.

 

[bucks_oil]

those tweets are what I have been trying to get through people heads everytime we have this discussion

the main board people are trying to say that I am wrong

But (flame away) I have dealt with and grew up with NHLers and they gave me incite into just how they pay taxes and it is not as us NORMAL people do

99.99% of this site just do not understand how the 1% pay taxes or do not pay taxes

That issue... taxation based on location of employment isn't just for the 1%. I split time US/Canada and pay the taxes the same way... I count the number of days in both locations and pay the effective rate in both jurisdictions on a pro-rata rate. It's just a way for the US and Canadian (and State and Province) to get their 'fair' share. Anyone who travels for work can do it... it's just a "required" thing when your travel is so obvious. Part of the US/Canada tax treaty.

 

[Jumptheshark]

That issue... taxation based on location of employment isn't just for the 1%. I split time US/Canada and pay the taxes the same way... I count the number of days in both locations and pay the effective rate in both jurisdictions on a pro-rata rate. It's just a way for the US and Canadian (and State and Province) to get their 'fair' share. Anyone who travels for work can do it... it's just a "required" thing when your travel is so obvious. Part of the US/Canada tax treaty.

and for about ten years I owned houses in multiple countries while listed a 4th as my prime residance--so I to have done multi jurisdictional taxes as well and had a good tax accountant who figured out how to same me money

I assure 100% you are over simplifying a complicated tax system where a smart tax accountant take make the world of difference

 

[Gord]

The thing is...it isn't a GM flaw, it is a salary cap flaw. I am not making it an excuse to fail, I am aware it provides a potential benefit to certain teams and not others in terms of recruiting better players for less which can be adjusted for parity sake.

so how would it work then? let's say you win, and teams have different salary caps depending on tax structure.
how do player contracts work? do they get adjusted in wording to take into account the local tax structure so if they get traded their salary changes?
using lucic as an example as someone else mentioned. if he went to florida, would he get paid less, or get his same amount that is in his contract. if the city he plays in has a tax increase every year, does he get a raise every year?

I'm sorry. you mean well, but let just leave it as it is. life isn't fair and the league has no obligation to try and make up for anybody's tax structure.

 

[Jumptheshark]

That issue... taxation based on location of employment isn't just for the 1%. I split time US/Canada and pay the taxes the same way... I count the number of days in both locations and pay the effective rate in both jurisdictions on a pro-rata rate. It's just a way for the US and Canadian (and State and Province) to get their 'fair' share. Anyone who travels for work can do it... it's just a "required" thing when your travel is so obvious. Part of the US/Canada tax treaty.

you are assuming ALL nhl teams are listed in the individual states or province and that each player is NOT a cooperation that only plays 1/2 of their games in one state or province and that other states, provinces and or cities do no not tax players for playing in their cities--that LITTLE thing--opens up a loop hole that MOST player's accounts expose and use to their advantage

just how high of a high ground I have on this--I have a cousin who played in the NHL for 15 years who clued me in

 

[PaPaDee]

I think it would be challenging to only focus on income taxes, for a specific market in relation to the salary cap for a couple reasons:

-First and foremost, the salary cap's main purpose is to create cost certainty for NHL owners. While it does provide a level of parity, that's not it's main focus or goal.
-Secondly, as has already mentioned, income taxes are only one factor that helps create an "uneven playing field", there's housing costs, insurance costs, general cost of living, etc.

If parity is a key concern for the NHL in this regard (and I don't think it is), I think it might be more worthwhile to look at generating a cost of living sheet for every NHL geographical location that takes into account taxes, housing, buying power, etc. and utilize that number to generate variations to the salary cup number for each team. But again, I don't see the NHL interested in going down that path.

 

[Roof Daddy]

There’s no denying that it is a slight advantage in luring players/retaining players when there is no state tax, but we’re starting to see some disadvantages arise - players with NMC’s/NTC’s unwilling to waive. TBay isn’t going to be able to move Killorn (full NTC), or Callahan (partial NMC) because those players stand to make slightly more money due to the tax benefits. Callahan has to name 16 teams he’ll accept a trade to, all he has to do is name 16 competitive teams up against the cap and he stays in Tampa. Lo and behold, he’s still a Bolt. They also have Palat and Johnson with full NMC’s. They’re starting to loose roster flexibility. A good problem to have with that talented of a team, but it could haunt them down the road.

For the 2019-20 season, they’ll have 8 players with NMC’s (7 full + Callahan who can structure his list so no one takes him) making 51 million. They also need Point extended before that season. They won’t be able to afford Karlsson.

 

[Jumptheshark]

POP QUIZ

What is the max numbers of days an individual can spend in the US of A before the US tax system can tax their world wide earning?

you guys do know the USA has the tax law right?

 

[joestevens29]

the first mistake MANY are making in this discussion is that EVERY team has their business listed in their home state or province they play in and that ALL players have their CITY listed as their prime residence

this is where my crazy comes in handy--at one point in time I owned houses in 3 different countries and had my main address in a 4th( houses lost in a divorce) and so I, with the help of ex-wife number 2 and her accountant--figured out how to work the tax system to our advantage

TOO MANY POSTERS ON THIS THIS SITE DO NOT UNDERSTAND THE MULTIPLE JURISDICTIONS laws when it comes to living, playing and primary residance when it comes to paying taxes

So what you are saying is the Edmoton Oilers can be listed in Florida?

 

[Summary]

I love the underlying assumption that the league is just going to hand some of the owners a payroll increase of say 20% and they'll all be like "sweet we can spend more now" without a single second thought.

The proposal here is to increase their costs by the local tax rate with no possible gain in revenue, just the good feeling that their $$$'s were passed straight to the gov't (though it won't be). But hey billionaires just wanna spend, right? Almost as much as we love spending it for them.

 

[MessierII]

Why isn't this a discussion in any other sport?

NHL is the only sport with a hard cap and guaranteed contracts.

 

[MessierII]

I love the underlying assumption that the league is just going to hand some of the owners a payroll increase of say 20% and they'll all be like "sweet we can spend more now" without a single second thought.

The proposal here is to increase their costs by the local tax rate with no possible gain in revenue, just the good feeling that their $$$'s were passed straight to the gov't (though it won't be). But hey billionaires just wanna spend, right? Almost as much as we love spending it for them.

Revenue sharing is already a thing. How do you think Phoenix pays its bills having lost money every year they’ve existed. Sometimes huge amounts at that.

 

[Weitz]

the first mistake MANY are making in this discussion is that EVERY team has their business listed in their home state or province they play in and that ALL players have their CITY listed as their prime residence

this is where my crazy comes in handy--at one point in time I owned houses in 3 different countries and had my main address in a 4th( houses lost in a divorce) and so I, with the help of ex-wife number 2 and her accountant--figured out how to work the tax system to our advantage

TOO MANY POSTERS ON THIS THIS SITE DO NOT UNDERSTAND THE MULTIPLE JURISDICTIONS laws when it comes to living, playing and primary residance when it comes to paying taxes

This just isn't right when it comes to Canadian tax law.