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Thread: Luxury tax article:

  1. #1
    Redemption. docpaul's Avatar
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    Default Luxury tax article:

    You all probably already knew this, but I thought it was interesting:

    http://sports.espn.go.com/nba/news/story?id=2935728

    The 25 non-tax-paying teams, meanwhile, will each receive 1/30 of the cumulative tax amount, which computes to nearly $1.9 million per team.
    So not only do luxury tax teams have to pay out, but they also don't get the perks accrued to being under the tax: namely $2mil this year.

  2. #2
    Fear my small avatar Gyron's Avatar
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    Default Re: Luxury tax article:

    Gotta love Isiah....He's paying the rest of the league almost $2 Mil Each to suck as bad as the Pacers!

  3. #3
    How are you here? Kegboy's Avatar
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    Default Re: Luxury tax article:

    Shouldn't the 25 teams get 1/25th of the tax amount? Is Napoleon keeping the other sixth?
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  4. #4
    Administrator Unclebuck's Avatar
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    Default Re: Luxury tax article:

    Every organization in the NBA must be Knick fans.

  5. #5
    Artificial Intelligence wintermute's Avatar
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    Default Re: Luxury tax article:

    Quote Originally Posted by Kegboy View Post
    This quote is hidden because you are ignoring this member. Show Quote
    Shouldn't the 25 teams get 1/25th of the tax amount? Is Napoleon keeping the other sixth?
    actually that's pretty close.

    according to larry coon:

    Tax money:
    * Teams under the tax level receive a full share (1/30) of the tax money. (Note that if the league expands, the fraction changes.)

    * Some or all of the remaining money may be reserved by the league for "league purposes."

    * Any remaining tax money that is distributed to teams must go to all teams in equal shares.

    "League purposes" may include investing in some venture, or it may include distributing money back to teams. If money goes to teams, the distribution must not be based on the teams' team salaries (see question number 14) or whether the teams are taxpayers. In other words, it cannot become a disincentive for teams to spend money on players, which would constitute a secondary form of salary restraint. An example of an acceptable "league purpose" in which money goes to teams would be a revenue assistance plan designed to subsidize teams that lose money, provided that a team's entitlement is based on a profit/loss/expenses computation that assumes all teams have the same team salary, and the assistance payment is limited to the team's actual losses.
    in practice, the league used the money for revenue assistance

    In 2005-06, the league used all of the undistributed tax funds and none of its escrow funds to fund their revenue assistance plan. In 2006-07 it used all of the undistributed tax funds and about $20.7 million of the escrow funds for this purpose.

  6. #6
    How are you here? Kegboy's Avatar
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    Default Re: Luxury tax article:

    They should use what's left to help us and the other ABA teams pay off St. Louis.

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  7. #7
    Banned Fool's Avatar
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    Default Re: Luxury tax article:

    What a deal that was.

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