Yanks hit with $25.69 million payroll tax

Open Thread: Forget the Hot Stove
Olney: Yanks working hard to land a pitcher tonight

For the Yankees, winning the World Series came with a hefty price tag this year as MLB announced on Monday that the Yankees were the only team to be levied a tax on its payroll in 2009. The team must pay its $25.69 million to the Commissioner’s Office by Jan. 31. This marks the seventh straight year that the Yanks have had to pay the tax, and of the $190 million in luxury tax payments collected by baseball, $174 million of that has come from the Yanks. Considering that the idea of the luxury tax was to rein in the Yanks’ spending ways, I’d say it’s been a stunning failure for baseball. At least the other teams can to benefit in form of added revenue earnings when the Yanks’ money is redistributed.

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Open Thread: Forget the Hot Stove
Olney: Yanks working hard to land a pitcher tonight
  • JM

    Racist against winners.

  • Monotonousblob

    and all those fans of other teams will gladly accept it while asking for a salary cap with a bottom lower than their teams payroll

  • SteveD Fla

    The Yankees have the money and they spend it. unlike some owners who put it in their pocket.

  • Johan Iz My Brohan

    With that $25.60 million the owners of the Marlins, Royals, Pirates, and others can buy a nice Christmas dinner… YAY!

  • 5th Starter

    How exactly does the tax work? Does the money truly get divvied up the the other 29 teams?

    • Ed

      Nope. It doesn’t go to the other teams. I’m not sure, but I believe it goes to thinks like the player’s pension fund and programs to promote baseball to kids.

  • ledavidisrael

    Young money arm!

    • ledavidisrael

      army*

  • Head Scratcher

    I suppose John Henry will start complaining that the revenue is not shared among small market teams such as Boston.

    • http://mlb.mlb.com/news/article.jsp?ymd=20090810&content_id=6355462&vkey=news_nyy&fext=.jsp&c_id=nyy JobaWockeeZ

      Poor Boston.

  • Pasqua

    Perhaps Johnny Damon will inform the Yankees that he will personally eat the $25 million luxury tax, thereby playing in 2010 for -$5 million dollars.

  • http://www.theyankeeuniverse.com/ Theo Epstien

    At least the other teams can to benefit in form of added revenue earnings when the Yanks’ money is redistributed.

    In theory, more than in practice.

  • http://twitter.com/riddering Riddering

    http://www.youtube.com/watch?v=VAOUbr2HEpo

    Don’t spend it all on relievers, MLB!

  • crawdaddie

    I thought the amount would be higher than that at the 40% tax rate. Is it 40% tax rate for all salary after the threshold amount and if so what was that amount in 2009?

    • http://www.riveraveblues.com Mike Axisa

      40% of everything over the threshold. So if the limit is $160M and they spend $200M, the $40M extra gets taxed.

      • crawdaddie

        Looks like the Yankees spent around 226-227M on total payroll for 2009. The threshold was 162M for 2009 which means 64+M was subjected to the 40% luxury tax rate.

  • Whitey14

    I think it’s high time that MLB forced it’s owners to open their books to a non-partisan individual or panel who would determine their actual income and then each team should be required to spend a minimum pre-set percentage of that income, or more.

  • Ed

    Considering that the idea of the luxury tax was to rein in the Yanks’ spending ways, I’d say it’s been a stunning failure for baseball.

    Eh, I think it works, it’s just that the Yankees make a ridiculous amount more than even the second highest revenue team does. They do have to at least pretend it’s not just a tax on the Yankees, so there’s only so far they can go.

    Without the luxury tax, the Yankees probably would’ve just spent an extra $25.69m on payroll instead. That’s good for another 1-2 big free agent signings.

  • Angelo

    Cuz Im the Taxman, yeaaaah im the taxman.

    /Beatles’d

  • THE KID

    Amazing stat, $174 of the $190 million came from the Yankees. I assume this is another great Bud Selig idea…

    While i love our teams willingness to spend to try and put together a winning team, i’d not be totally opposed to some type of salary cap (realizing the players union would never let that happen).

    But then you’d better damn sure have a salary basement as well so direct revenues and especially shared revenue like this doesn’t just go into the pockets of the Royals & Pirates & Padres, etc. who it doesn’t appear even try to win.

  • lichmd

    This is a travesty. The Yankees spend 53% of revenue on salary (for the 40 man, not counting coaches), teams like the Pirates and Marlins are in the low to mid teens. The Twinkees spend 43% of revenue on salary, even though Carl Polhad is vastly richer than the Steinbrenners. We need a minimal salary, as a floor, to ensure that teams are making a good faith effort to put together winning teams, otherwise these welfare checks are just a travesty of a mockery of a sham.

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