RE: Luxury tax

["Ravi Singh" <kelticsfan@xxxxxxxxx>]

John,

All talk in the news of not having a luxury tax this year was for the
season just completed.  The luxury tax assessment is determined after
the season as basketball related income and salaries including bonuses
must be calculated and factored into the equation before a tax threshold
can be determined. This past season, salaries and benefits came in at
60.2% of BRI which is below the 61.1% that would have kicked in the
luxury tax.  For the upcoming season, it is expected that salaries and
benefits will exceed 61.1% of BRI thereby kicking in the tax.  

-Ravi

-----Original Message-----
From: owner-celtics@igtc.com [mailto:owner-celtics@igtc.com] On Behalf
Of John Spindler
Sent: Thursday, July 18, 2002 7:11 AM
To: awang@MIT.EDU
Cc: celtics@igtc.com
Subject: Luxury tax 


Very thorough and detailed analysis of the luxury tax
and it's potential impact on the Celtics roster.  It
may however be a moot point, as the NBA announced last
night that the luxury tax will not be in effect this
year. Michael Jordan's return and the related revenues
that it generated was cited as one of the reasons that
the tax threshold would not be triggered for the
coming season.  If I understand the implications of
this, we should be able to resign Rodney under the
current CBA, and still be under the tax threshold when
Kenny Anderson comes off the books next year. It is
also entirely possible that the tax will not be
triggered next year either.  The real winners based on
last nights announcement are the high spending teams
such as Portland and Dallas.  They still have the high payrolls, but are
not going to pay a penalty for it this year. 


In any case, Gaston seemingly no longer has the luxury
tax excuse for not signing Rogers, and will have a lot
of angry season ticket holders on his hands if he
raises prices and lowers payroll; not to mention the
message this sends to Walker and Pierce.  I for one
believe that Gaston will do the right thing, and pay
Rodney what he is worth.  It is just a buyers market,
and he is being a businessman.
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