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beavis
12-28-2004, 08:45 AM
Link (http://apnews.myway.com/article/20041228/D878C7582.html)

AP: Yanks, Angels BoSox to Pay Luxury Tax

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Dec 27, 9:23 PM (ET)

By RONALD BLUM

NEW YORK (AP) - The Boston Red Sox got an extra bill after winning the World Series. Boston and Anaheim must pay baseball's luxury tax along with the New York Yankees, according to final figures compiled by the commissioner's office.

The Yankees are required to pay $25,026,352, according to a Dec. 21 memorandum that was sent to all major league teams. Boston owes $3,155,234 for exceeding the payroll threshold of $120.5 million and Anaheim got a bill for $927,059.

Checks for the competitive-balance tax, as it is formally known, are due at the commissioner's office by Jan. 31.

"The CBT is now an important part of baseball's economic landscape," Red Sox owner John Henry said in an e-mail Monday. "From my perspective, even though it costs us, the stronger the CBT is in the future, the stronger the sport is going to be. It is a much more productive form of taxation than that of strictly revenue taxation because the economic incentives for teams are not damaged."

In 2003, the first year of the new luxury tax, the Yankees were the only team to pay, owing $11,798,357, according to the team's latest revised bill. Because they exceeded the threshold a second time, the Yankees were taxed at a rate of 30 percent for the amount they were over. Boston and Anaheim were taxed at a 22.5 percent rate.

If the Yankees go over the 2005 threshold of $128 million, which appears certain, they would be taxed at a 40 percent rate.

New York also estimates it will give up about $60 million as part of baseball's revenue-sharing plan this season, meaning the Yankees will send the commissioner's office about $85 million of their estimated $315 million revenue in 2004. Boston's revenue-sharing payment is estimated at approximately $42 million on revenue of at least $220 million.

The Yankees easily finished ahead of other teams in the regular payrolls figures for the sixth straight season, winding up at a record $187.9 million, $18 million above the previous mark they set in 2003.

Boston, which overcame a 3-0 deficit against the Yankees in the AL championship series and won the World Series for the first time since 1918, was second at $130.4 million.

Anaheim, defeated by the Red Sox in the first round of the playoffs, was third at $115.6 million, followed by the New York Mets ($103.2 million), Los Angeles ($101.7 million), the Chicago Cubs ($100.7 million) and Philadelphia ($97.4 million).

St. Louis, swept by Boston in the World Series, was eighth at $92.8 million.

At the other end, Tampa Bay finished with the lowest payroll for the third straight season. At $24.4 million, the Devil Rays had the lowest figure for any team since 2000.

Milwaukee was 29th at $29.6 million, down from $43.3 million, and Pittsburgh was 28th at $32.5 million, down from $53.3 million.

Texas fell from fifth at $103.3 million to 13th at $79.2 million, Atlanta went from sixth at $98 million to 12th at $79.4 million, Seattle dropped from seventh at $97.7 million to 11th at $81.8 million and Arizona declined from 11th at $83.8 million to 15th at $68.4 million.

Anaheim rose from 12th at $80 million to third, the Cubs increased from 10th at $84 million to sixth and Philadelphia went up from 15th at $71.5 million to seventh.

Payrolls include salaries, prorated shares of signing bonuses, earned bonuses, buyouts of 2004 options and cash transactions.

For the luxury tax, which is based on 40-man rosters, the average annual values of contracts and includes benefits, the Yankees finished with a payroll of $203.9 million, while Boston was at $134.5 million and Anaheim at $124.6 million.

Many midlevel teams appear to be spending money on free agents this offseason, possibly because of the shift in economics created by increased revenue sharing. That could push the average salary higher next season.

According to the players' association, the average dropped 2.5 percent this year to $2,313,535 from $2,372,189, the first decrease since 1995 and only the third since record-keeping began in 1967.

beavis
12-28-2004, 08:47 AM
Anyone else catch this? I find it amazing that the Yankees spend enough to get taxed at 25%. It's also pretty humerous to see that the average salary is going to go up with increased revenue sharing. Just proves that the players need to boot Fehr for feeding them the Kool-Aid all these years.

If revenue sharing really has increased by as much as they say it has, I expect the smaller market teams (Royals) to start spending, no excuses. Especially Glass, who has said he wants to operate the team on a break even basis. I've been a pretty solid supporter of his philosophy since he got here, but now it's time to put your money where your mouth is.

Saulbadguy
12-28-2004, 08:48 AM
start printing playoff tickets!

morphius
12-28-2004, 09:10 AM
Anyone else catch this? I find it amazing that the Yankees spend enough to get taxed at 25%. It's also pretty humerous to see that the average salary is going to go up with increased revenue sharing. Just proves that the players need to boot Fehr for feeding them the Kool-Aid all these years.

If revenue sharing really has increased by as much as they say it has, I expect the smaller market teams (Royals) to start spending, no excuses. Especially Glass, who has said he wants to operate the team on a break even basis. I've been a pretty solid supporter of his philosophy since he got here, but now it's time to put your money where your mouth is.
I don't know what the revenue sharing totals are, but 30 mill from the those 3 teams split among the other 29 isn't exactly a windfall.

beavis
12-28-2004, 09:41 AM
I don't know what the revenue sharing totals are, but 30 mill from the those 3 teams split among the other 29 isn't exactly a windfall.
That's just the luxury tax, I was refering to revenue sharing.

New York also estimates it will give up about $60 million as part of baseball's revenue-sharing plan this season, meaning the Yankees will send the commissioner's office about $85 million of their estimated $315 million revenue in 2004. Boston's revenue-sharing payment is estimated at approximately $42 million on revenue of at least $220 million.
That's about $102 million (excludinig the luxury tax) for just the top two revenue teams. That's fairly significant IMO. Not to mention it works two ways, it gives the smaller market teams money, while taking it away from the big boys, thus leveling the field.

Dave Lane
12-28-2004, 11:35 AM
Anyone else catch this? I find it amazing that the Yankees spend enough to get taxed at 25%. It's also pretty humerous to see that the average salary is going to go up with increased revenue sharing. Just proves that the players need to boot Fehr for feeding them the Kool-Aid all these years.

If revenue sharing really has increased by as much as they say it has, I expect the smaller market teams (Royals) to start spending, no excuses. Especially Glass, who has said he wants to operate the team on a break even basis. I've been a pretty solid supporter of his philosophy since he got here, but now it's time to put your money where your mouth is.

And the Royals 1/28 of the Yankees $25 million comes to...

Wow they are right now we can be totally competitive! WooHoo!

Dave

Mr. Laz
12-28-2004, 12:36 PM
so apparently the Royals will be receive approx 5 million as their share of all this money sharing stuff.



:(

melbar
12-28-2004, 12:47 PM
Wow! Maybe we can buy Carlos Beltrans Left foot back!!

bobbything
12-28-2004, 12:52 PM
Many midlevel teams appear to be spending money on free agents this offseason, possibly because of the shift in economics created by increased revenue sharing. That could push the average salary higher next season.
This is key. If small market teams get 1/29 of $25 million, that's not a big deal. For instance, if KC gets $860,000, that's only about a 3% increase in their payroll. However, the Yanks spent about $75 million in excess of the "cap" at 30%. This luxury tax nonsense isnt doing anything except increasing payrolls all around, exponentially increasing salaries.

But, as long as the Yankees are in the playoffs every year, that's good for baseball....right?

beavis
12-28-2004, 12:55 PM
Wow, we all apparently have a reading comprehension problem today.

The only numbers presented in the article are those of the 3 teams that payed luxury tax and the top 2 teams revenue sharing numbers. If I remember correctly, it's something like the top 10 that have to share their revenue with the others. If you're going to make asinine statements, at least read the article before you do so.

If I had to venture a guess, I'd say the Royals are getting somewhere between $6-$10 million in revenue sharing this year. It doesn't solve any problems, but it's a huge move in the right direction.

beavis
12-28-2004, 12:56 PM
This is key. If small market teams get 1/29 of $25 million, that's not a big deal. For instance, if KC gets $860,000, that's only about a 3% increase in their payroll. However, the Yanks spent about $75 million in excess of the "cap" at 30%. This luxury tax nonsense isnt doing anything except increasing payrolls all around, exponentially increasing salaries.
Exactly. It's a win-win for the players and the owners, if the players would ever realize that.

Demonpenz
12-28-2004, 01:02 PM
the royals signed julio franco today to a 6 million dollar contract