THN: What a NHL player pays in taxes depending on team

[indes]

Originally Posted by Flames Fan, Ph.D.

Yup. This is why I've argued the whole tax narrative is BS since players aren't flocking here.

The other thing to consider is that the 300K the player saves is basically all from the provincial vs state tax delta. And living in Seattle with the cost of living, you'll lose all of that if you buy a house etc...

Is cost of living as big of a deal for these guys when they're already buying the best of everything? I'm curious what the difference is between the high-end stuff, when you look at cost of living. Like Italian center groceries vs whole foods, private chef wages, luxury cars - does it make a huge difference once you're in the luxury world?

Honest question as I wonder if these guys even worry about that or just consider it a sunk cost as to wherever they go.

[Snazu]

Once again we are in the mushy middle.

[Flames Fan, Ph.D.]

Originally Posted by indes

Is cost of living as big of a deal for these guys when they're already buying the best of everything? I'm curious what the difference is between the high-end stuff, when you look at cost of living. Like Italian center groceries vs whole foods, private chef wages, luxury cars - does it make a huge difference once you're in the luxury world?

Honest question as I wonder if these guys even worry about that or just consider it a sunk cost as to wherever they go.

I'm one who thinks this isn't as big a deal as people make out to be, so take that with a grain of salt. But if 5-10% is a factor for someone making 8 million, then why not for someone making 3 million. And this argument goes both ways: if you're living luxury life and it doesn't make a huge difference because you have the big bucks, who cares if you're taxed a bit more?


Anyways, I just think people want to live where they want. Plenty of high priced free agents take big contracts in cold, high tax locations. I don't think taxes is a major determinant here.

[indes]

Originally Posted by Flames Fan, Ph.D.

I'm one who thinks this isn't as big a deal as people make out to be, so take that with a grain of salt. But if 5-10% is a factor for someone making 8 million, then why not for someone making 3 million. And this argument goes both ways: if you're living luxury life and it doesn't make a huge difference because you have the big bucks, who cares if you're taxed a bit more?


Anyways, I just think people want to live where they want. Plenty of high priced free agents take big contracts in cold, high tax locations. I don't think taxes is a major determinant here.

I would agree with that for sure. I was curious if there's even that much of a difference in cost of living for the wealthy and if there is, I doubt it's high enough to even make a difference. Different than us deciding if we want to spend 40% of our wage on housing in Calgary or 75% in Vancouver anyways.

[Flames Fan, Ph.D.]

Originally Posted by indes

I would agree with that for sure. I was curious if there's even that much of a difference in cost of living for the wealthy and if there is, I doubt it's high enough to even make a difference. Different than us deciding if we want to spend 40% of our wage on housing in Calgary or 75% in Vancouver anyways.

FWIW, live in an average neighborhood on the outskirts of Seattle is 750K - 1 milion house. Live in a nice neighborhood and it's ~3 M and above.

Sad to report no Kraken players live near me so the above ring true

[Steve Bozek]

I found it interesting that the Federal tax rate is higher in the USA than Canada. The big difference is provincial vs state taxes, but are sales taxes included in the calculations?

[butterfly]

Originally Posted by indes

Is cost of living as big of a deal for these guys when they're already buying the best of everything? I'm curious what the difference is between the high-end stuff, when you look at cost of living. Like Italian center groceries vs whole foods, private chef wages, luxury cars - does it make a huge difference once you're in the luxury world?

Honest question as I wonder if these guys even worry about that or just consider it a sunk cost as to wherever they go.

You can buy a really impressive house in Dallas with a $3M salary. In Seattle it will be nice but nothing special.

[Cheese]

and...this is only taxes, take off a minimum 3-5% for player agents off the bottom line plus equipment, etc.

[Torture]

Originally Posted by indes

Is cost of living as big of a deal for these guys when they're already buying the best of everything? I'm curious what the difference is between the high-end stuff, when you look at cost of living. Like Italian center groceries vs whole foods, private chef wages, luxury cars - does it make a huge difference once you're in the luxury world?

Honest question as I wonder if these guys even worry about that or just consider it a sunk cost as to wherever they go.

And if anything, cost of living would be a benefit for a market like Calgary, and many of the Canadian markets.

Getting paid in USD while your living expenses are in CAD pretty much evens out any tax advantage US markets have. Maybe not so much in Vancouver or Toronto.

[Calgary4LIfe]

Another aspect of this is that a team in Florida or Seattle can pay players less, which allows more cap flexibility for them. Some players will be willing to take less in those markets simply because their take-home would be the same, giving those teams a bit of an advantage.


However, players can be traded of course, so players willingly taking less can then get burnt at some point in their deal. I wonder how many players take discounts when negotiating their deals, and how many make sure they get trade protection on top of it for this very reason. Just an added interesting wrinkle here.

I have long suspected that taxes are a 3rd or lower tie-breaker for players deciding which teams to play. Winning, location (weather, logistics, amenities) and where there family are probably play larger roles in choosing where to go, among other variables. It does, however, seem silly to think that differing tax rates hasn't impacted which markets players choose to play in. That's a lot of money on the table.

[accord1999]

Originally Posted by Steve Bozek

I found it interesting that the Federal tax rate is higher in the USA than Canada. The big difference is provincial vs state taxes, but are sales taxes included in the calculations?

The American state governments (even for California) are considerably smaller in terms of revenue/capita than Canadian provincial governments. For example the BC government has a budget of ~C$80B while next-door Washington State is only ~US$70B despite 2 million more residents than BC.

[Enoch Root]

Originally Posted by Steve Bozek

I found it interesting that the Federal tax rate is higher in the USA than Canada. The big difference is provincial vs state taxes, but are sales taxes included in the calculations?

No

[DoubleK]

Originally Posted by mogg

I did not expect Seattle to be anywhere near the bottom, let alone last.

Why do you think I moved to Seattle?

[butterfly]

It doesn’t matter much anyway. Most of their career value is prior to UFA.

How many of them even get to that point? Who has been the best UFA? Lindholm? Skjei? Duchene? Samsonov? Foegele? Useful pieces but hardly an all star team. Keep an extra $400k cap space hanging around and you can get people like this when you need them.

[Enoch Root]

Originally Posted by butterfly

It doesn’t matter much anyway. Most of their career value is prior to UFA.

How many of them even get to that point? Who has been the best UFA? Lindholm? Skjei? Duchene? Samsonov? Foegele? Useful pieces but hardly an all star team. Keep an extra $400k cap space hanging around and you can get people like this when you need them.

What are you talking about?

All players gain UFA status, and that is why their contract values are so high - they have options. Even if they remain with their current team.

[FlamesAddiction]

Originally Posted by Steve Bozek

I found it interesting that the Federal tax rate is higher in the USA than Canada. The big difference is provincial vs state taxes, but are sales taxes included in the calculations?

Sales tax would seem like something that would be more applicable to straight-up cost of living comparisons since they are reflected in prices.

It would be interesting to see some kind of ranking if you factor in taxes and cost of living though. Like which markets will make you richer overall.

[butterfly]

Originally Posted by Enoch Root

What are you talking about?

All players gain UFA status, and that is why their contract values are so high - they have options. Even if they remain with their current team.

How many exercise it? They seem to stay where they already are through draft or trade.

[Enoch Root]

Originally Posted by butterfly

How many exercise it? They seem to stay where they already are through draft or trade.

For the ones that don't exercise it - are they getting a higher number to stay (because of their tax environment)? It doesn't require players hitting the open market for this to have an effect.

[Flames Fan, Ph.D.]

Originally Posted by accord1999

The American state governments (even for California) are considerably smaller in terms of revenue/capita than Canadian provincial governments. For example the BC government has a budget of ~C$80B while next-door Washington State is only ~US$70B despite 2 million more residents than BC.

The lucky trade-off is that we get to feel a sense of community in buying things off the wish lists of the teachers, administrative, and custodial staff at our public schools. Provided they don't close down ~20 of them.

Low taxes ftw!

[Flames Fan, Ph.D.]

Originally Posted by Calgary4LIfe

Another aspect of this is that a team in Florida or Seattle can pay players less, which allows more cap flexibility for them. Some players will be willing to take less in those markets simply because their take-home would be the same, giving those teams a bit of an advantage.

Not sure any of the 'low tax state' teams are banking on that, and I'm even more unsure there are any players who take this view.