The winner of the National League Championship Series could determine whether Major League Baseball is played in 2027.
This might sound far-fetched. It is not. What looks like a best-of-seven baseball series, which starts Monday as the Milwaukee Brewers host the Los Angeles Dodgers in Game 1, will play out as a proxy of the coming labor war between MLB and the MLB Players Association.
Owners across the game want a salary cap – and if the Dodgers, with their record $500 million-plus payroll, win back-to-back World Series, it will only embolden the league’s push to regulate salaries. The Brewers, consistently a bottom-third payroll team, emerging triumphant would serve as the latest evidence that winners can germinate even in the game’s smallest markets and that the failures of other low-revenue teams have less to do with spending than execution.
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The Brewers have joined the Tampa Bay Rays and Cleveland Guardians as vanguards of low-revenue success in this decade. Over the past eight years, Milwaukee has won five NL Central titles and made the playoffs seven times. At 97-65 this year, the Brewers owned the best record in baseball. And they did so with a unique blend of players.
Of the 26 players on Milwaukee’s NLCS roster, 15 came via trade, according to ESPN Research, including a majority of its best players
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The Dodgers, on the other hand, are not nearly as free-agent-heavy as might be assumed. They’ve acquired the most players via trade, too, though it’s only nine, and several of them – from Mookie Betts to Tyler Glasnow to Tommy Edman to Alex Vesia – play a significant role on the team. Los Angeles signed five major league free agents (including Shohei Ohtani, Freddie Freeman and Blake Snell), plus two professional international free agents (Yoshinobu Yamamoto and Hyeseong Kim), two amateur international free agents (Roki Sasaki and Andy Pages) and two minor league free agents (Max Muncy and Justin Dean). They drafted five of their players – one more than the Brewers, whose development system is regarded as one of baseball’s best – and rounded out their roster with Jack Dreyer, an undrafted free agent.
Dreyer highlights what the Dodgers and Brewers do exceptionally well: extract talent from players through systems that value a combination of scouting, analytics and superior coaching. It doesn’t matter whether you spend half a billion dollars or the $115 million or so currently on the Brewers’ books. If you can become an organization that gets the best out of players, winning will follow.
Payroll adjusted for average and tax limit rankings since 2004 (84 teams total, excludes 2020)
LAD 2
TOR 26 (close to average)
SEA 66
MIL 78
Now based on this data.
Seattle and Milwakee wont WIN the World Series. No team has ever won with that low of payroll.
They need to do 2 things. If they’re wont be a cap.
1 a tax floor. 50% of the tax cap.
So next year tax cap of $244m. Floor should be $122m if your under that. You pay a tax equal to the difference.
2 stricter tax!!! Like the NBA put into place.
Boston. 18m over the tax limit. Or about 10% over the $187.986m tax limit.
Repeat offender, they have a $40m tax bill!
So 10% over with a 20% tax on top.
Dodgers? 47% OVER the limit with only a 40% tax on top. If it was the NBA rules. They would have WELL over a 120% tax. Or close to a 300 tax bill ON TOP OF their 355 payroll. Meaning a 655m+ total payroll vs just 460m
Need to address method teams are using more and more to get around the tax; deferred payments. Regarding the Dodgers above here is Ohtani’s contract.
Shohei Ohtani signed a historic 10-year, $700 million contract with the Los Angeles Dodgers in December 2023, which was the largest contract in professional sports history at that time. The contract includes a unique structure where $680 million is deferred, meaning he will only receive $2 million annually until 2034, when the bulk of the payment will begin.
As much as I would hate to miss an entire baseball season, I really hope the owners hold out for as long as it takes to get a hard salary cap like they have in football.
I don’t really care for millionaires and billionaires squabbling over money, but I’m 100% tired of the playing field not being level.
Yep, the current structure leaves low-to-mid market teams in the dust. Too much circumventing the current structure as @frm710 pointed out on top of that. It’s great if you’re a big market team - like the Wings in the late 90s/early 00’s, just spend your way to wins. Sucks for everyone else.
Strange question, but I’m curious how others feel about this: Should the cap be adjusted depending on a State’s tax rates? Should the states with no income tax rates be the baseline, and the cap rises according to match each State’s tax rate?
That would impact the
Marlins
Rays
Rangers
Astros
Mariners
Not sure it would impact much of anything as I believe and it has been a while since I read on this, how the players are taxed.
If not mistaken the players, independent contractors, are taxed for the games they play in each state. If correct then they wouldn’t pay taxes when they play in FL, the state tax that is, not sure about city etc. Plus the players in the three states it would impact play 81games in those states.
Edit found this from Forbes
Player Salaries And Tax Implications
One of the most visible aspects of baseball’s relationship with taxation involves player salaries. Major League Baseball players are among the highest-paid athletes in the world, and their income is heavily taxed. The tax burden on baseball players is more complex than it might seem at first glance, especially for players who work in multiple states during the course of a season.
A professional baseball player’s salary is subject to federal income taxes, but also to state and local taxes, which vary widely. For example, players who play for teams in states like California or New York face higher state income taxes than players in states like Texas or Florida, where generally there is no state income tax. This situation is known as the “jock tax,” a term used to describe the practice of taxing athletes based on where they earn their income. As players travel to different cities and states to play games, they often find themselves owing taxes in multiple jurisdictions, creating a complicated tax filing process.
PROMOTED
To alleviate some of this burden, many MLB teams structure contracts with tax considerations in mind, negotiating terms that allow for some tax relief. For example, certain benefits, like performance bonuses, may be structured to minimize tax exposure. However, the sheer scale of players’ earnings and the number of different tax jurisdictions involved can still result in a considerable tax liability. As a result, many players employ tax professionals to help navigate the complexities of their financial situation.
That’s my feeling as well. At the same time, many of the States that have higher tax rates also offer greater potential for endorsement opportunities (though that seems to be trending downward over the past decade). I just don’t know how else you balance that out. If I’m offered a $500 million dollar deal where one destination is taking $35 million and the other is taking $220 million….. it’s a not even a decision at that point, it’s common sense.
In the NFL the most “tax friendly" division is the AFC South. There are 3 teams in no income tax states…Houston Texans, Tennesee Titans and Jacksonville Jaguars. So if you play for one of those teams, you enter every season with at least 10 games with more favorable taxes.
