Major League Baseball’s luxury tax has reached new heights, with a record nine teams owing penalties this year. The Los Angeles Dodgers topped the list, paying a record-breaking $103 million penalty. The New York Mets come in second, with their total tax bill nearing $229 million.
The luxury tax is calculated based on each team’s average annual payroll, including earned bonuses and benefits. Teams that exceed the threshold face penalties ranging from 30% to 110%. This year’s total tax paid by teams reached a record $311.3 million, exceeding last year’s high of $209.8 million.
The Dodgers’ tax bill includes $1,032,454 in non-cash compensation for Shohei Ohtani, whose contract calls for the use of a suite at Dodger Stadium and an interpreter. The Yankees owe $62.5 million, while other teams including Philadelphia, Atlanta, Texas, Houston, San Francisco, and the Chicago Cubs also faced penalties.
The tax money collected since its introduction in 2003 has surpassed $1 billion, with over 15 teams paying a combined total of $1.23 billion. The Yankees lead the list, followed by the Dodgers at $350 million.
Source: https://apnews.com/article/mlb-luxury-tax-dodgers-mets-dbd88c1dffe35d7b8153be4b7a4fe9e8