For a few years now, the issue of NHL teams and their tax situation has been debated by pundits and NHL executives.
As the Florida Panthers are two wins away from defending their Stanley Cup championship, it’s been hard to ignore that they, the Tampa Bay Lightning, the Vegas Golden Knights and even the Colorado Avalanche have won it all in recent years while having some of the lowest taxes of any NHL team.
In January, San Jose Sharks GM Mike Grier said he saw both sides of the tax issue, but that he also would hypothetically support a tax equalization plan.
Another proponent of such a plan is TNT analyst and former NHL player Paul Bissonnette, who has repeatedly said he wants the league to address the issue.
This week, Bissonnette took his grumbling to the NHL commissioner himself, Gary Bettman, in an NHL on TNT interview at the Stanley Cup final. But Bettman deftly counterargued, and if we’re being honest, we have to say he did a solid job of speaking against any type of plan to deal with tax inequalities from team to team.
“It’s a ridiculous issue,” Bettman said. “When the Florida teams weren’t good, which was for about 17 years, nobody said anything about it. For those of you who played, were you sitting there at the tax table? No, you wanted to go to a good organization in a place where you wanted to live, where you wanted to raise your kids and send them to school. You wanted to play in a first-class arena with a first-class training facility, with an owner, an organization, a GM, and a coach that you were comfortable with. And you wanted to have good teammates so you would have a shot at winning. That’s what motivates it.
“Could it be a little bit of a factor if everything else were equal? I suppose, but that is not it. By the way, state taxes are high in Los Angeles, high in New York. What are we going to do? Subsidize those teams?”
Now, let’s be clear – we do see the no-tax states having an advantage, so we’re not prepared to agree with Bettman that this issue is “ridiculous.” But after interviewing NHL Players’ Association executive director Marty Walsh in November, and after hearing Bettman’s response to Bissonnette, our position has evolved.
In this instance, we have to give Bettman credit. Part of his job as commissioner is making good arguments for the league’s decisions. And in this case, he did just that. And as Walsh said, finding the type of mechanism to level out the league’s tax situations is next to impossible.
But here’s where our philosophy has evolved: there are other scenarios where some teams would have an advantage, and you don’t see teams crying out for new labor deal elements to address them.
For instance, the weak Canadian dollar might be seen as an issue to Canadian team owners, but if you really think about it, it might be spun as a selling point to free agents and players considering being dealt to Canada.
After all, if you’re making American money as all players do, and you’re playing in a Canadian market, your cost of living is far better than it would be if you were in an American market. Let’s say you’re getting $1.33 Cdn. for every American dollar – wouldn’t that be a huge win for you as a player? Your money would be improved by one-third if you’re in a Canadian market. So why aren’t Canadian teams selling that angle?
We want the playing field to be as level as possible while also being fair to teams that are more successful than others. That’s why we still believe a luxury tax would be a great solution for the NHL, the same way it is in the NBA. But clearly, the league prefers its hard salary cap, and that’s not likely to change, even with a new collective bargaining agreement coming up in the next year. That’s just the reality of the situation.
As Walsh told THN.com, there are many variables at play with taxes, and as Bettman noted, the bigger factors in players’ decisions on where to play probably have more to do with how well teams are managed and how competitive their rosters are. So you can see why there’s consensus between the league and players in this regard.
Bissonnette was within his rights to raise the topic in front of Bettman, but the commissioner held his own on this front and more or less ended the debate for now. It may come up again down the road, but anyone holding their breath for a change anytime soon need all the luck they can get.
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