Tax Question

[42PhD]

Not exactly a suggestion, but someone will say move it here eventually.

Real question: Is the tax as it is constructed, working?

Working is not just doing something, it is actually working to the overall benefit of the League even if some feel pain at times.

[Xist2Inspire]

Well I know that back in the old league, the points collected through lux tax bills were then distributed to non-playoff teams according to their standing. This helped teams without "point machine" players to collect points and improve their teams. We no longer have the "point machine player" issue, and it's pretty darn easy to get points, but with more and more teams paying the tax these days, we should probably do something about putting the points gained to use somehow. It's better than letting them all disappear.

[42PhD]

I was more thinking of the actual goals and if they are being reached in the right way.

I think the tax is intended to provide incentive not to go over the cap by so much by tying it to a particular kind of cost structure than it then hooked to penalties once the ability to pay is exhausted. Those penalties are supposed to stop people from actually having to be subjected to them too often.

Now, that it itself seems to be working partially, but some teams are crippled and others are on their way there. At some point, and this is realistic, the League will be operating at three-quarters strength, and maybe some will just quit. This is not some necessary eventuality, but it's something to be avoided.

So, it may be that the penalties are not stiff enough, actually, as opposed to too stiff, since teams are just accepting them. We also see that, for the most part, the contenders are just high taxpayers. There is the Sixers example, and there will be others, to show that the tax is not necessary, but that lesson, too, is not being heeded too much.

Also, it seems to be that part of the issue to be addressed is not the cap figure but the way talent is distributed in the League. In the end, handing out stupid contracts is one of the absolute fundamental problems that ties into many others, but I think the tax simply serves to help shape who collects that talent disproportionately, not so much that it happens.

Is talent distribution even on the radar for GM's? What about how contracts are doled out?

Until bids are restricted in some what when Bird Rights are exercised, as they are in some ways in the NBA, then I'm not sure there is a real solution to the problem.

This is more of a conversation than a call to arms or anything, but I'd be remiss if i didn't at least start the discussion.

[Soundwave]

I decided to break up my Championship winning squad mostly due to the tax.

[ballsohard]

I think all the points you make are fair, but with or without a tax, it can be argued that the league always operates at 3/4. Ie there will always be at least 1/4 teams tanking for the draft talent grab. I think we're just starting to see some of the implications of managing your cap like a child. People have managed it reasonably and eventually had to break up those winning squads .. Wig, sound, etc

[42PhD]

The preceding comments show that some desired effects do in fact happen. So, the tax is not useless... Not by a country mile.

The question is really if there are things it causes that are bad and unwanted, good things it should cause that it does not.

As far as operating at 1/4 goes... I am talking about ownerless teams on top of what we normally see.

Again, I am not proposing anything or that there be a change, just discussing. The points about poor cap management are well-taken. Anyone who does quit because they shot themselves in the dick is just weak. There are many good reasons to quit, but quitting because you put yourself in timeout is not one.

[78#]

The tax hasn't acted as a deterrant, but it has caused teams to break up quality squads due to potential of high penalties. However, those teams who have been average for several seasons or lower-seeded playoff teams will try to get over the hump by any means. So that's why the tax hasn't been a strong deterrant, but it does cause teams to sell earlier instead of letting things play out over several seasons. And those teams usually sell to other teams who end up going over the cap/tax.

[78#]

Maybe long-term, the tax will cause the league in general to plan according such as not having more than 1-2 max players on a team, selling guys early to acquire draft picks, young prospects, etc. However, there are teams looking to build a team quickly for a deep run and will temporarily pay a high price for it. Can that be avoided? Probably not for a struggling GM looking to win big.

[WigNosy]

The entire point of a salary cap - and tax - is for competitive balance - to wit, when a team throws a lot of high-paid superstars together, there must be a force acting to eventually break that team up so that the rest of the league has a chance to reach the top. Given that, I would say the point system and luxury tax so far has worked as intended, as every would-be dynasty has broken up before the players' natural aging progression would have ruined their dynasty due to tax implications (e.g., Celtics, Donyell Marshall; Hawks, Latrell Sprewell - the list could go on).

[42PhD]

I don't think that is the entire point. I think it is an important point and the impetus.

A machete can cure cancer, so can poison, but we use scalpels and chemo because a little precision actually keeps some patients alive.

The force chosen may do it's job and more.