As one economist described it, MLB’s Competitive Balance Tax, otherwise known as the Luxury Tax, was designed to target really one club, the Yankees. And yet, in every year that there has been the soft cap in baseball, the Bronx Bombers have blown through the thresholds like a 100-MPH fastball.
But, it appears that the penalties are finally wearing on the club, and stiffer penalties in the CBT are likely a large part of the reason why.
I detail changes to the Luxury Tax as part of MLB’s new labor agreement today in my second installment for Baseball Prospectus (see Bizball: Inside the 2012-16 MLB CBA: Minimum Salaries, the Luxury Tax). Within the article, I touch on how the system could (finally) be weighing on the Yankees:
The Competitive Balance Tax (CBT), otherwise known as the luxury tax, continues in the latest agreement (the prior agreement had a provision by which it could potentially be retired), and with it, the league got a bump at the top for those clubs that could be ...
Found June 04, 2012 on
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