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MLB Luxury Tax Essay

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It is now Spring training and there are elite players who are still not signed. They are not signed because owners want to stay under $197 million dollar luxury tax. A tax that is supposed to keep the league balanced and ensure that games are competitive. The luxury tax in the MLB is pretty much a soft salary cap. This means that if teams go over a certain amount of money on the payroll, they will be fined. For repeat offenders, the penalty keeps growing. For the 2018 baseball season the luxury tax limits $197 million. This tax is supposed to balance the league hence the name of the competitive balance tax. This debate has been going on since the tax was created in 2003. The single controversy around this is that not every team is helped by …show more content…

One reason that supports the claim that the MLB luxury tax should be eliminated is the free agency market has slowed thanks to the tax. This offseason has moved slowly. It has moved slowly because teams do not want to pay elite free agents because of the tax. According to The luxury tax is bad for MLB “teams have operated at a glacial pace. With less than six weeks until pitchers and catchers report, nearly every player is still on the market. As of January 5th, only six of Jeff Passan top-20 free agents have signed, and the lack of rumors surrounding available players gives the impression that may not change soon” (Cwik 2018). Pitchers and catchers …show more content…

The tax is supposed to give small market teams a chance at big market players. But it usually does not help with this. They usually still go to the bigger teams. According to Chris Cwik´s (the author of The luxury tax is bad for MLB), and is already destroying the game “small teams aren’t magically able to offer $120 million contracts for top flight players with the luxury tax in place. Large market teams can still hand out multiple $80 million deals like it's nothing. It’s not as if the luxury tax has suddenly made the Tampa Bay Rays a serious candidate for J.D. Martinez. The Yankees handing out $80 million to Martinez is still better than anything the Rays can offer” (Cwik 2018). This tax does not keep the league balanced. J.D. Martinez will still go to a big team. Just because the small teams get money does not make the league competitive. Nobody wants to play for a bad team. All the big names are going to the good big teams because they can win with them and they do. That leaves the small teams with the meh caliber players and the big ones with the best. Also, the big teams are getting the good players for cheap. While if a small team wants a good player they have to pay a ton. Another piece of information from The luxury tax is bad for MLB, and is already destroying the game is “the way this is supposed to work is the big free agents will go to

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