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Salary Cap Question

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06-06-2011, 12:47 PM
  #1
NHLFutureGuy3
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Salary Cap Question

Amongst the media, the cold winters, and other reasons, one of the biggest reasons for players not wanting to sign here is apparently the high taxes.

If I'm not mistaken, a player from Montreal that makes that same gross salary as a player from Tampa Bay, for example, will actually make less net income and still count for the same cap hit. As a result, Canadiens have to overpay to sign players and this effectively means we have less cap room than other less taxed cities.

If this is true, why is the salary cap based on gross revenue? Shouldn't the salary cap be based on net income? I'm sure the NHL, or the Canadiens would be willing to hire accountants to determine how much gross income would be required to pay each player to obtain a desired net income.

This is something I've always wondered.

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06-06-2011, 12:59 PM
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This is something I've said for a really long time, the contract should be in after tax dollars. It is unfair and as if we didn't already have to compete with sunny Florida, California and others, we now can't even compete money wise because of our taxes.

I doubt it changes because it's exactly what Bettman wants.

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06-06-2011, 01:33 PM
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habs03
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This is a major problem. Even Cammy said it, I read once that its about an additional 1M per year on long contacts, for example I Gio signed 5/25, I bet if he signed in FLA or resigned with the Devils, all they would have to pay is 4/20.

So ya adjusting the salary to after tax would be perfect, but the problem is there other things you have to take into account, players for sure find ways to end up paying less tax, and it would be too hard to figure out.

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06-06-2011, 01:40 PM
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Montreal Typical
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If it was that big a deal, New York, Toronto and Montreal wouldn't be able to sign anyone -- well, Toronto can't right now, but that's because the Leafs suck -- and the Florida teams and Dallas would be getting all the top free agents.

Some players will only go for the money, but others have different priorities (such as winning).

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06-06-2011, 01:47 PM
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Quote:
Originally Posted by Railman View Post
If it was that big a deal, New York, Toronto and Montreal wouldn't be able to sign anyone -- well, Toronto can't right now, but that's because the Leafs suck -- and the Florida teams and Dallas would be getting all the top free agents.

Some players will only go for the money, but others have different priorities (such as winning).
To be fair, if you were to look at teams that have overpaid players the most in the past few years, New York, Toronto, and Montreal are near the top of the list. So it IS a big deal in that it forces the clubs to compensate with bigger contracts, but because they are still desirable cities, doesn't limit interest.

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06-06-2011, 02:04 PM
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Originally Posted by #11 Saku Koivu View Post
So it IS a big deal in that it forces the clubs to compensate with bigger contracts, but because they are still desirable cities, doesn't limit interest.
They're not forced to overpay, at least not nearly as much as they do. They overpay that much because they have ******** GMs and because they have the money to throw around (which many teams don't).

The most sought after players are overpaid no matter where they go. It's the nature of the beast. That's why a team should never go for such a player on the UFA market unless said player truly is a top tier talent.

Anyway, considering all the tax loopholes, the difference between different cities is not nearly as big as it might seem at first.

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06-06-2011, 02:08 PM
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NHLFutureGuy3
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Quote:
Originally Posted by Railman View Post
If it was that big a deal, New York, Toronto and Montreal wouldn't be able to sign anyone -- well, Toronto can't right now, but that's because the Leafs suck -- and the Florida teams and Dallas would be getting all the top free agents.
It's not a big deal to the players because teams like Montreal, NY, and Toronto end up giving them huge contracts to compensate. However, it does matter to Montreal as a whole because for each contract that we have to overpay to compensate we become that much closer to the salary cap. As a result we are not be able to sign an extra roster player when a less taxed city is able to.

Quote:
Originally Posted by Railman View Post
Some players will only go for the money, but others have different priorities (such as winning).
Each player is different. So why not try to put as many factors on our side as possible to eliminate the tax issue as one of the possible reasons for not signing here?

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06-06-2011, 02:48 PM
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Quote:
Originally Posted by Railman View Post
If it was that big a deal, New York, Toronto and Montreal wouldn't be able to sign anyone -- well, Toronto can't right now, but that's because the Leafs suck -- and the Florida teams and Dallas would be getting all the top free agents.

Some players will only go for the money, but others have different priorities (such as winning).
NYC has to overpay anyways if only due to the massive cost of living.

Other states have not only low taxes but a low cost of living. How can a place like Toronto compete with that?

At the end of the day money is a priority for all players and they have to make decisions that will not negatively effect them or their family.

A high cost of living, bad area, bad weather, that kind of stuff is already bad enough for some teams, throw on top of that the fact of the taxes and it's bordering on completely unfair.

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06-06-2011, 02:52 PM
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Quote:
Originally Posted by Railman View Post
They're not forced to overpay, at least not nearly as much as they do. They overpay that much because they have ******** GMs and because they have the money to throw around (which many teams don't).

The most sought after players are overpaid no matter where they go. It's the nature of the beast. That's why a team should never go for such a player on the UFA market unless said player truly is a top tier talent.

Anyway, considering all the tax loopholes, the difference between different cities is not nearly as big as it might seem at first.
Of course they aren't, nobody has a gun to their heads. But frankly if you were GM of the team and you knew you'd be fired because you can't ice a competitive team due to people always bringing up taxes, etc when negotiating and you know nobody would sign here without overpaying what would you do? Just magically find players that do? Clearly it's an issue or they wouldn't be overpaying, so in essence your point about them not being forced to is silly. Yeah of course they aren't forced to but it's either overpay players and ice a competitive team and keep your job, or ice a crap team don't land any players and get fired.

Yeah I guess though because they aren't forced to at gun point, automatically these gm's like Gainey/Sather who have won cups as managers must be complete ****ing tools.

Obviously they don't overpay because they just want to throw money at any UFA, they do so because every time they do negotiations these factors play a part and thus they'd lose out on signing significant players if they didn't overpay.

Quote:
Originally Posted by NHLFutureGuy3 View Post
It's not a big deal to the players because teams like Montreal, NY, and Toronto end up giving them huge contracts to compensate. However, it does matter to Montreal as a whole because for each contract that we have to overpay to compensate we become that much closer to the salary cap. As a result we are not be able to sign an extra roster player when a less taxed city is able to.



Each player is different. So why not try to put as many factors on our side as possible to eliminate the tax issue as one of the possible reasons for not signing here?
That's exactly it. People who think Gainey/Sather are ******** simply don't understand how tough a job it really is. This isn't NHL 11.

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