Lux Tax Implications

[JohnVancouver]

Interview with David Kahn - Hoopsworld: " I just think that in this economy in particular, unless you really feel you're going for it and can win it all or have a shot at winning it all, I would have a very hard time under any set of circumstances approaching (owner) Glen Taylor and saying, 'You know, we really need to be a taxpayer this year.' Not only do you end up spending so much more, but under our current set of rules it prohibits you from sharing in the revenue coming back. In this economy I think that -- almost doubly so -- that you just can't be a taxpayer. It fundamentally affects decisions, especially for next season. There are a lot of teams that already are committed to salaries that have them in the tax area because of the way the revenues have decreased, so it's causing all of us, I suspect, to really have to work harder at figuring out how to put together a team in a fiscally responsible manner."


I didn't know about the revenue sharing aspect - maybe everyone else does, but that was news to me. I would imagine PHX is one of the ones doling out rather than recieiving merch and tv money back.

[Mr. Sun]

Yep, taxpayers don't get a share the tax revenue. That is another important reason for suns to get under. This is a rich mans game. Suns owners are not rich and overpaid to buy the team.

[Frank Lee]

but they have been steadily lowering the tax and cap limits down.... forcing teams to be more monetarily responsible and spanking the ones who are trying to buy a championship. It is an effective governor on the system, but it forces teams to sacrifice basketball for bottom lines. One byproduct will be lower salaries. Look for the player's union to squawk some after this next Free Agency signing period. The tax gives the owners justifiable leverage and now that most teams will be under the tax, the 'accountants' will no longer control the team.