Taxes influence NHL teams’ recruiting abilities

Higher taxes make Montréal, Los Angeles, San Jose and Anaheim are some of the least financially attractive destinations for NHL players, says a report by the Canadian Taxpayers’ Association and Americans for Tax Reform.

For example, left winger David Perron faces a tax hike of $95,868 after being traded from the Edmonton Oilers to the Pittsburgh Penguins. He’s moving from Alberta’s 43.5% tax rate to 46.7% in Pennsylvania. And the Montreal Canadiens’ tax rate is the highest in Canada: 49.5%.

Read: The true costs and benefits of hockey

On the other hand, former Buffalo Sabres defenceman Tyler Myers will save $474,146 after being traded to the Winnipeg Jets, moving from New York’s 50% rate to 46% in Manitoba.

Dallas, Florida, Tampa Bay and Nashville all rank among the best places to play from an income tax standpoint.

Read: P.K. Subban makes $10M donation to Montreal kids’ hospital

“The NHL salary cap was supposed to level the playing field, but teams like the Toronto Maple Leafs have a 16% ‘true cap’ disadvantage compared to their Atlantic Division rivals in Tampa Bay,” notes CTF federal director Aaron Wudrick. “There’s more than one reason why a guy like Phil Kessel doesn’t mind being traded to Pittsburgh. He will pocket an additional $170,136 as a result.”

“NHL players are just one example of highly skilled workers who have a choice of where to work,” Wudrick adds. “The same principles apply for doctors, engineers, and CEOs of major companies. Governments need to keep that in mind when they’re considering the impact of tax rates on attracting top talent.”

Read more here.

Also read: Hockey generates $11B for the Canadian economy

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.