The Braves find themselves among an unprecedented eight teams contributing to the luxury tax, having surpassed the initial Competitive Balance Tax (CBT) threshold. Major League Baseball has officially disclosed the list of teams subject to luxury tax assessments for the 2023 season, marking a record both in terms of the number of contributing teams (eight) and the total amount assessed ($209.8 million).
The NL East boasts three teams on this list, with the New York Mets leading the way by incurring a bill exceeding $100 million. This surpasses the previous luxury tax record set by the Los Angeles Dodgers in 2015, who faced a $43.6 million tax on their $291.1 million payroll.
| Team | Amount | Repeat Payor? |
|---|---|---|
| New York Mets | $100,781,932 | Yes (2nd year) |
| San Diego Padres | $39.7M | Yes (3rd year) |
| New York Yankees | $32.4M | Yes (2nd year) |
| Los Angeles Dodgers | $19.4M | Yes (3rd year) |
| Philadelphia Phillies | $6.98M | Yes (3rd year) |
| Toronto Blue Jays | $5.5M | No (1st year) |
| Atlanta Braves | $3.2M | No (1st year) |
| Texas Rangers | $1.8M | No (1st year) |
Notably, the Atlanta Braves enter the realm of luxury tax payment for the first time in their history, attributed to their unprecedented 2023 CBT payroll of $245.9 million, as reported by Fangraphs. Looking ahead, the financial landscape for the Braves is poised to become even more substantial in 2024, with a projected CBT payroll of $269 million, pending arbitration outcomes.
Does Atlanta care about the luxury tax?
Not at all. At the Winter Meetings, President of Baseball Operations Alex Anthopoulos told us that the front office is concerned with the cash payroll versus the tax payroll – they follow the tax payroll to know how much they’ll be paying in fines, but the focus is on the cash number.
Here’s the pertinent quote:
“I concentrate on the cash amount, so what the actual cash out the door is.” What the tax would look like, so the CBT figure – aside from being over, we don’t pay attention to it. We do pay attention to the dollar worth of taxes because that must be paid, as well as salaries because they must be paid.”
The Braves have until the 21st of January to make payment to the commissioner’s office.
According to MLB Trade Rumors, the league will split the $209.8 million in luxury tax penalties three ways. The first $3.5 million is allocated to player group benefits. The next $103.15 million is allocated to individual player retirement accounts (yes, baseball players have 401Ks), with the remaining $103.15 million going into a discretionary account for the commissioner’s distribution. This money is awarded to revenue sharing recipients who have increased local revenues over the last few seasons (excluding any local broadcast/media partnerships).