The Business of HockeyDiscuss the financial and business aspects of the NHL. Franchise sales, valuations, TV contracts, ratings, expansion, relocation, the CBA and work stoppage discussion goes here.
How big of a problem are taxes for Canadian teams?
How big of a problem are taxes for Canadian teams?
Are there that big of an issue? It seems teams like Montreal or Toronto just can't attract big name players. Hossa, Jokinen, Richards, Marleau, Gaborik are just examples of a couple of players who were UFA's in the last few years and were targeted by Canadian markets. Obviously none of them made it to an actual Canadian team.
That begs the question, why do Canadian teams seem to have such a hard time attracting premier UFA's. To me it is one of the main reasons Canadian teams have been largely unsuccessful in the past two decades. Sure, drafting is the key but after you draft your young core, you need veterans to support the team and guide these youngsters. Take New York for example; Redden, Gaborik, Richards, Nash, Gomez just a couple of big names they nabbed through free agency. Canadian teams seem to be unable to do that, they have to build almost entirely through the draft and sign serviceable role players in the free agents market.
I'm wondering, are taxes the biggest problem? Are they the reasons Canadian clubs can't attract star UFA's?
Are there that big of an issue? It seems teams like Montreal or Toronto just can't attract big name players. Hossa, Jokinen, Richards, Marleau, Gaborik are just examples of a couple of players who were UFA's in the last few years and were targeted by Canadian markets. Obviously none of them made it to an actual Canadian team.
That begs the question, why do Canadian teams seem to have such a hard time attracting premier UFA's. To me it is one of the main reasons Canadian teams have been largely unsuccessful in the past two decades. Sure, drafting is the key but after you draft your young core, you need veterans to support the team and guide these youngsters. Take New York for example; Redden, Gaborik, Richards, Nash, Gomez just a couple of big names they nabbed through free agency. Canadian teams seem to be unable to do that, they have to build almost entirely through the draft and sign serviceable role players in the free agents market.
I'm wondering, are taxes the biggest problem? Are they the reasons Canadian clubs can't attract star UFA's?
Taxes are a big deal. Even for Alberta teams, many US places are cheaper. It was not as big a deal in the pre cap era where there was no salary cap, because of the low dollar and the fact stuff was cheaper here. Since 2004 while the NHL playing field has leveled, so has the rest of the world.
They're certainly a factor, but clearly not the biggest factor. If they were, then the Panthers and Bolts would be beating off major free agent interest due to Florida's lack of a state income tax.
To be honest, I think that the media attention is the biggest factor. There's simply put a lot more pressure to succeed in a Canadian market, where your team's the #1 focus by the local sports media regardless, versus in the United States, where every market has at least one, and oftentimes several, teams that get more ink.
You have essentially all the positives both sides of the borders for professional athletes, and then some in the U.S. for hockey players for the lower pressure, public focus on everything you do, and, yes, lower taxes, so it all adds together.
Are not California and Massachusetts worse then Alberta overall in terms of taxes?
MA is kind of middle of the road tax wise. They are high up the list of states mainly because it's one of the wealthiest states. The state tax is pretty reasonable.
Taxes are total nonsense, when you factor in health insurance, the difference in crossing the border is almost non existent.
The bigger difference is which state/province you live in and even then it's an over statement.
The real issue is housing costs, which would mean places like LA, and Vancouver in theory should been incapable of winning.
The reality is the market is pretty flat just as it is for any other industry.
Some like the sun, some like being in towns where people actually care about hockey, most prefer to be close to home and family, some avoid cities, some want to be rock stars. The list goes on.
And of course a bigger factor, is a teams reputation, how's its playing, and if you can fit on the team.
Fact is too many folk think of being on a team, as being the same as being in AAA in high school, the reality is it's closer to being in the navy than anything else.
Do you think any NHL players really cares about this?
Agreed. If they get hurt on the job the team (their employer) is supposed to cover their medical expenses anyway.
They'd have to do something like stab themselves in the eyeball with a golf tee after getting eliminated from the playoffs, which is at least more likely in Florida...
If you're going to use the Rangers as an example, why not add the fact that players who play for the Islanders pay the exact same tax?
On a state level that would be true, however for the Rangers if the players live in the City, they'd also pay the NYC income tax, which people on the Island don't pay.
Here top marginal Rates for some Canadian Provinces for 2013 (Both Fed/Provincial)
Alberta-39%
Ontario-49% (for people who make $500K plus)
Quebec-50% (for people who make $100K plus)
BC-43.5%
The top Marginal Rate is 39.6% for federal in USA, plus your state taxes.
Essentially Alberta is as good as a tax free state in the USA.
Just an update I was doing some digging for American Rates (I am a CA in Toronto)
California after the bump of 35 to 39.6% increase on Federal and the bump of many state taxes below are the TOP Marginal tax rates for many state. Keep in mind Marginal rates are not what you pay on your entire income, just the rate at your highest income level.
Example: In Ontario salary was $600,000 you only would pay 49% tax on income between $500,000 and $600,000.
Some of the Rates in US- This includes, state, federal, city and other taxes paid (IE medicare)
On a state level that would be true, however for the Rangers if the players live in the City, they'd also pay the NYC income tax, which people on the Island don't pay.
Well players on the Islanders pay Nassau County property taxes if they own a house. I'm pretty sure Nassau County has the highest property taxes in the country, or maybe it's the second-highest.
__________________
"Trust me I'm an expert, I watched 13 rangers games on NHL center Ice this year through streaming." -Starburst
"I don't even understand what the point of all this arguing is. Are you guys hoping that the other side is going to have an epiphany and go 'Oh, OH! You're right, we ARE going to lose this series!'" -Crease
Agreed. If they get hurt on the job the team (their employer) is supposed to cover their medical expenses anyway.
They'd have to do something like stab themselves in the eyeball with a golf tee after getting eliminated from the playoffs, which is at least more likely in Florida...
Or get eaten by zombies....
Quote:
Originally Posted by HugoSimon
Taxes are total nonsense, when you factor in health insurance, the difference in crossing the border is almost non existent.
The bigger difference is which state/province you live in and even then it's an over statement.
The real issue is housing costs, which would mean places like LA, and Vancouver in theory should been incapable of winning.
The reality is the market is pretty flat just as it is for any other industry.
Some like the sun, some like being in towns where people actually care about hockey, most prefer to be close to home and family, some avoid cities, some want to be rock stars. The list goes on.
And of course a bigger factor, is a teams reputation, how's its playing, and if you can fit on the team.
Fact is too many folk think of being on a team, as being the same as being in AAA in high school, the reality is it's closer to being in the navy than anything else.
If this was the case Canadian teams would get more FAs. Some people don't like pressure at all. Some wanna be rockstars, NY provides that.
That is old data. There have been major tax increase in the States since. Namely the removel of Bush tax cuts bringing in the highest US rates to 39.6% from 35%. As well as many state and provincial tax changes for 2013.
The real issue is housing costs, which would mean places like LA, and Vancouver in theory should been incapable of winning.
San Jose then should be in that list as they are part of the #2 most expensive housing market (after NYC). I believe that Phoenix (aka Glendale, and Scottdale) would be among the most attractive as they are one of the lowest costs of NHL cities.
Another issue "against" Canadian teams, as we found out during the CBA negotiations, is the issue of pensions. (Players in Canada get less "tax free" set asides than US.)
Taxes are a big deal. Even for Alberta teams, many US places are cheaper. It was not as big a deal in the pre cap era where there was no salary cap, because of the low dollar and the fact stuff was cheaper here. Since 2004 while the NHL playing field has leveled, so has the rest of the world.
Alberta has a provincial flat tax at 10%. This puts the top marginal tax rate at 39% on income over $135K. The US top marginal tax rate is 39.6% at $400K.
Of course there is more to how much tax you pay than the top marginal rate, but I doubt that taxes are as big an issue in Alberta as they would be in Quebec.
