Multiple reports indicate that Major League Baseball has
officially acknowledged that
only two of their thirty franchises exceeded the 2018 payroll threshold of $197 million—kicking in the Competitive Balance ("luxury") Tax. The two are: the World Series Champion Red Sox and the Washington Nationals. The estimated 2018 payroll for the Red Sox is $238.4 million. Because Boston did not exceed the threshold in 2017, they are "only" subject to a 20% tax rate on the amount over $197 million. However, because they also have payroll over $217 million an
additional surtax of 12% kicks in on
that overage. But wait, MLB's not done taxing
The Carmine Hose yet! There's an
additional 42.5% surcharge assessed on payroll beyond $237 million. It gets better! In addition to all these
monetary penalties, the Red Sox will also have their
next draft pick moved back ten spots. But they
do get a lovely set of steak knives from Commissioner
Rob Manfred. Yikes! Good thing they won the whole enchilada—which kind of makes it worth it!
