According to leadership from both the National Hockey League (NHL) and the NHL Players` Association (NHLPA), who are currently engaged in negotiating a new collective bargaining agreement, the issue of state income tax is not considered a significant concern.
Speaking in Edmonton before the start of the Stanley Cup Final, NHL Deputy Commissioner Bill Daly acknowledged that some franchises have raised state tax as an issue, but stated, “What I’d say at this point is, we don`t share the level of concern that they have.” Daly emphasized that such imbalances have always existed and are not new. He pointed out that many factors unrelated to a market`s tax situation, such as location, team environment, or coaching, influence a player`s decision on where to play. Consequently, the league does not anticipate proactively addressing this matter in the upcoming collective bargaining negotiations.
The recent success of teams based in states without income tax, specifically the Florida Panthers and Tampa Bay Lightning representing Florida in three consecutive finals, and the Vegas Golden Knights from Nevada reaching three finals since their 2017 inception, has led to complaints of unfairness from general managers and fans in heavily taxed provinces and states.
NHLPA Assistant Executive Director Ron Hainsey expressed his “bafflement” regarding the prominence of state tax rates as a contentious topic. He highlighted the league`s dominant teams from 2008 to 2020 – Pittsburgh, Chicago, Los Angeles, Detroit, and Boston – noting that star players like Sidney Crosby, Evgeni Malkin, Kris Letang, Brad Marchand, Patrice Bergeron, and Zdeno Chara could have earned more elsewhere but chose to remain with successful teams despite different tax situations compared to Florida. Hainsey suggested the current run of success by Florida and Tampa Bay might simply be part of a cyclical trend, questioning whether it genuinely represents a persistent issue based solely on taxes.
Florida Panthers General Manager Bill Zito also downplayed the tax factor, stating that winning championships involves more than just free agents accepting lower salaries offset by tax advantages. He stressed the importance of committed ownership, fostering a winning and inclusive team culture, and addressing roster needs through trades.
Adding a state or provincial tax clause to the salary cap structure would be highly complex. Furthermore, the cost of living varies significantly across NHL cities, and Canadian players receiving salaries in U.S. dollars while paying expenses in Canadian currency adds another layer of complication.
The perception of the no-state-tax issue appears to be exaggerated, according to both the league and the players` association.
Panthers defenseman Seth Jones acknowledged that players appreciate bigger paychecks, implying tax benefits could play a role. However, he suggested the current situation is perhaps temporary and noted that team success is also heavily influenced by effective drafting and player development.
