Skip to content

Lakers had the highest luxury tax bill last season, followed by these five teams

Jul 10, 2013, 8:00 AM EST

Lakers starters walk onto the court after a timeout during their loss to the Dallas Mavericks in their NBA basketball game in Los Angeles Reuters

It is theoretically possible to buy the talent necessary to win a championship in the NBA, but especially since the terms of the new collective bargaining agreement went into effect, it would come at a very substantial cost.

We’ll get to that in a moment.

For now, let’s look at the teams who were served with the biggest luxury tax bills for their respective 2012-13 payrolls.

From Marc Stein of ESPN.com:

Your NBA luxury-tax champions from the 2012-13 season? Lakers informed tonight that they were officially charged $29,259,739 in ’12-13 tax

Rest of NBA’s 2012-13 tax bills: 2. MIA ($13,346,242), 3. BKN ($12,883,647), 4. NYK ($9,962,406), 5. CHI ($3,932,336), 6. BOS ($1,181,640)

As has been well-chronicled, the roster of the Lakers failed due mainly to a rash of injuries over the course of the season to key players, but also because of an inability from Dwight Howard to ever truly buy in to the team concept.

L.A. tried to assemble top talent to compete for a title, and paid for it handsomely. The team right behind them on the list of taxpayers was the Miami Heat, who won a second straight championship while paying less than 50 percent of the tax that the Lakers did in the process of getting swept in the first round of the playoffs.

The Nets will seemingly always be taxpayers while their billionaire owner is in charge, and it gets worse for them next season when the new tax penalties kick in — as Stein also reported.

Wanna know how new NBA world works? With essentially same payroll as Lakers last season, Nets will owe $70+ mil in tax after 2013-14 season

You read right, my friends. Nets projected, at this early juncture, to owe somewhere between $72M and $77M in taxes after coming season

The Knicks are another large market that can afford the penalties, and so are the Bulls, who went as far as New York in the playoffs despite their injury-ravaged roster.

What is never mentioned in payroll considerations is the TV deals in certain markets that are conveniently kept separated from these discussions. The Lakers, Nets, and Knicks have substantial, long-term television contracts that can more than offset much of these costs. Other teams, however, are not so fortunate.

The list will be very different next season, as teams like the Lakers and Celtics who seemingly will have no shot to compte for a title will fall off, while the overall bills will decrease due to the increased tax penalties levied by the new collective bargaining agreement.

There will always be teams that may be willing to try to pay for a title, but despite those best efforts, we learned that nothing is guaranteed. You need to look no further than the way that the previous season unfolded with the Lakers in Los Angeles to come to that realization.

  1. dyn0myte - Jul 10, 2013 at 8:17 AM

    “…the Lakers failed due mainly to a rash…”

    More like a jock itch.
    Named Buss.

    • kb2408 - Jul 10, 2013 at 9:55 AM

      Are you referring to the same Jim Buss that made a brilliant deal for CP3 that would’ve had the LAKERS in position to dominate for the next several seasons? That Jim Buss?! Jim is getting a bad rap but from everything I’ve read and heard it was the great Dr. Jerry Buss that wanted Mike D. as coach. Had Stern not screwed up a great deal Jim B. would be viewed very differently today. The writer is correct, Dwight and injuries decimated the LAKERS. The only qualms I have about last season is the LAKERS should’ve kept Mike Brown if they weren’t going to hire Phil or B. Shaw.

      • dyn0myte - Jul 10, 2013 at 12:00 PM

        Some day, in the not too distant future,
        you will be embarrassed to recall the time that you used “Jim Buss” and “brilliant” in the same sentence.

      • brookwell2013 - Jul 10, 2013 at 12:03 PM

        kb my man what are you smoking?? Give us all some! The Buss kid is an idiot and has no clue how to run any team let alone the Lakers. The old man (may he rest in peace) had nothing to do with the D’antoni hire — he was as we all know now extremely ill and out of the loop. “Should’ve kept Mike Brown”?????? Are you nuts?? Everyone inside the NBA knows he is the biggest fraud ever; can’t coach at ALL. Come on kb, tell us what you’re smoking and share!

      • abchome - Jul 10, 2013 at 1:49 PM

        Welcome to PBT! Jimmy LOL

    • zxrated - Jul 10, 2013 at 10:26 AM

      The Jimmy bashing is tired. Phil had no shot because he wants FO power and Dr. Buss was never gonna give him that. Phil disrespected too many people in the Lakers FO… West, Dr. Buss, Jimmy, Tex Winter. Jimmy is just keeping his Dads wishes, as seen in this 2005 interview. The conversation is almost exactly the same as the one Jimmy had with Phil in November when D’Antoni was chosen.

      • dyn0myte - Jul 11, 2013 at 11:05 AM

        Is this the video you intended to post?
        I’m not sure I’m following your thinking at all.

        Which of your claims –
        that Phil wanted front office power
        that Phil disrespected people in the Laker front office
        or that Dr. Buss did not want to rehire Phil as coach

        is supported in any way by this video?

        …and exactly which part of this interview would be “…the same as the one Jimmy had with Phil in November…”

        Perhaps the part where Dr. Buss denies the possibility of sharing ownership of the Lakers with a new coach, because “..the Lakers belong to my children..”

        Couldn’t Phil respond, “and their lawfully wedded partners…”

      • zxrated - Jul 17, 2013 at 12:22 PM

        @ dyn0myte, Everything about this video screams of Dr. Buss distaste for Phil. The constant condescending comments nature of the Dr. Buss/West Jackson relationship It’s well known by those that don’t buy the media hype. Buss flat out said Phil will never get any place at the Buss owned Lakers table in this video. The questions asked are the exact topic at hand today. Phil said he feels he’s done as a HC and wants a FO place. This is the point.

  2. burm61 - Jul 10, 2013 at 8:55 AM

    29 mil for a 7th seed? Good job Lakers! Way to continue the legacy!

    • kb2408 - Jul 10, 2013 at 9:45 AM

      Dude, let it go, ok? So what, it didn’t work out, WE ALL GET IT, OK?!! However, the fact of the matter is, the LAKERS have had far more “hits” than “misses” over the past three decades. Question: how do you know if a franchise is great? Because it’s news when they DON’T win the title. The LAKERS are the only franchise in the NBA that is expected to contend for a title every single season.The LAKERS are still the cream of the crop and that will be proven going forward.

      • fm31970 - Jul 10, 2013 at 9:59 AM

        The past doesn’t matter today, nor in the future, when it comes to the luxury tax. All those banners in the rafters are great to look at, but they don’t help you build a good team within the salary cap. The point of this article is that if you’re going to spend over the cap and be taxed, you might as well win a championship doing so. Miami has done it twice, and maybe will a third time this year, but will they be willing to pay $45M (a guess based on the $13M above for last season) to keep up this pace?

      • cmehustle - Jul 10, 2013 at 5:06 PM

        Where u from and how old are you?? I only ask because if you’re not from Cali, and if your not in your late 40’s than what the hell do you know about the Lakers hits and misses the last three decades? Just like most bandwagon Faker fans that aint nowhere near California, I cant stand listening to that BS. You need to let it go.

    • kb2408 - Jul 10, 2013 at 10:33 AM

      fm31, the fact of the matter is, only one team can win the title. And if you don’t think all those banners mean something it’s probably because you root for a team that’s content with winning once every other decade, or so. Even with the new CBA there are going to be a few teams that always go over and suffer the consequences. My point is the LAKERS will probably always be on that list and I like there chances to win more times than they lose. When all the dust settles only 3-4 teams will consistently pay the tax penalty to win. And of those teams the LAKERS have historically proven they know how to win more so than the others.

      • loungefly74 - Jul 10, 2013 at 11:07 AM

        exactly, KB.

        i don’t buy into that paradigm of fm31970’s thinking that nothing else matter…(ha! listening to Metallica at this moment on the ipod with random shuffle!) except for the present. anyway, lets “time travel” back to 2008. the Lakers knew they were going to pay the price down the road (the present) to contend for the titles during that time…and they came away with 2 titles! hell yeah! would i trade that away for anything else? no way. why? i’m still frickin’ happy about that. so…today, yeah, the Lakers are paying the price but as history as shown and proved…the Lakers tend to bounce back and rebound strong. let me put it this way…ask a fan of cleveland (or any other market longing for a title) sports if they are willing to win a title in exchange for a few/several years of lesser results…oh yeah, they will take it. i’ll take it!

        and nice job for pointing out only 1 team can win a year. you cant win every year. what was fm31970’s thinking about Miami in 2008…or 2009…or 2010? was he thinking because they played “crappy” (no title) those years that they should just pack up for the rest of their existence? no…who the F thinks like that? does fm31970 think that once a team wins a title that year and the next day, the fans and team should have the thought of ” ohhhh…we won…but that was yesterday…oh well…that time is gone. oh well…its in the past.”???? no way…freaking enjoy it. as far as i’m concerned…the Lakers, Mavs, and Heat are the only teams where fans can still beat their chest about recent accomplishments. (the Celtics’ time just expired this year according to my “5 year rule” hehehehe)…

      • dyn0myte - Jul 10, 2013 at 12:44 PM

        kb,

        I am a Laker fan.
        I’ve attended games at Staples, and before that, at the “Fabulous” Forum.
        I’ve gone to their summer league games.
        I watched Andrew Bynum’s first game in a Laker uniform at the Cal State Long Beach Pyramid.

        But even a fan of the team,
        even a person who bleeds Forum Blue and Gold
        can see there is little hope for the future under the direction of Jim Buss.

        And if you don’t believe me,
        look at what those closest to the Lakers are saying.

        Then, I suppose, you can argue with Magic Johnson.

  3. peachfuzz1954 - Jul 10, 2013 at 9:20 AM

    “It is theoretically possible to buy the talent necessary to win a championship”

    Uh……………..D’UH!

  4. ivo11 - Jul 10, 2013 at 9:21 AM

    I’ve always been curious to who recieves those tax dollars. Do they pay that tax penalty to the League? to Stern?

    • Kurt Helin - Jul 11, 2013 at 1:33 AM

      The Tax money is divided and split up among the non taxpaying teams.

  5. dezglobal - Jul 10, 2013 at 9:43 AM

    Brooklyn Nets will pay $72-77 MILLION next season… Is there any profit? lol

    • deadeyedesign23 - Jul 10, 2013 at 10:09 AM

      It’s almost certainly a loss, but he doesn’t care about that he owns all the property in the Atlantic Yards (the property around the stadium). So he’s willing to take a 20 or 30 million loss on the Nets because it makes the property around it worth hundreds of millions more if theres a good basketball team around the corner.

  6. logisticalvoices - Jul 10, 2013 at 10:22 AM

    What happens to the tax money? I haven’t been able to find that out.

    • skinsfanwill - Jul 10, 2013 at 11:32 AM

      That’s where the Commish gets his vacation money

    • Anoesis - Jul 10, 2013 at 5:41 PM

      From cbafaq.com:

      Tax money:

      Up to 50% of the tax money may be given to non-taxpaying teams. Note that there is no requirement that any of the tax money be distributed to teams in this manner.

      Any tax money not distributed to teams will be used for “league purposes.” In other words, at least 50% of the tax revenue will be used for league purposes each season.

      “League purposes” essentially means for any purpose the league decides, including distributing the money back to teams. The league decided that in 2011-12, 100% of the tax revenue will be used as a funding source for the league’s revenue sharing program. Starting in 2012-13, 50% of the tax revenue will be used as a funding source for the revenue sharing program, and the remaining 50% will be distributed to non-taxpaying teams in equal shares.

  7. azarkhan - Jul 10, 2013 at 12:07 PM

    The Lakers are like the Yankees, they always think they can buy a championship. Fortunately however, the NBA isn’t like MLB. The NBA makes teams like the Lakers pay a price for arrogance and stupidity.

    • loungefly74 - Jul 10, 2013 at 12:21 PM

      i see the Yankee analogy…but having 7 Finals trips since 2000 is “paying the price”? okay, man…i’ll buy that s#*t wholesale!

    • zxrated - Jul 10, 2013 at 12:25 PM

      Every team “buys'” it’s players, there’s this thing called free agency that the players fight for which allows all teams to buy players.

      • azarkhan - Jul 10, 2013 at 12:49 PM

        Every team can’t afford a $29,259,739 luxury tax. You see, there’s this thing called salary cap….

    • zxrated - Jul 10, 2013 at 1:00 PM

      When you willing to pay the cost to be the boss so be it. The Heat brought their championships. The Spurs were a luxury tax offender when they won theirs. Dallas was in 2011… starting to see a pattern? If you want to win as an organization, you MUST SPEND

  8. dyn0myte - Jul 10, 2013 at 1:19 PM

    If you want to win as an organization, you MUST SPEND wisely.

    • zxrated - Jul 10, 2013 at 6:06 PM

      Exactly, 16x ten in the last 33 years or 1 out of ever three championships is the Buss spending model. #Wise

  9. florida727 - Jul 10, 2013 at 1:36 PM

    Here’s what’s scary…

    The Nets, after paying that tax next year, will still turn a profit. What the heck has professional sports devolved into?

    • blueintown - Jul 10, 2013 at 1:54 PM

      A highly profitable enterprise?

  10. spinmovr - Jul 10, 2013 at 6:57 PM

    Lost in all of this is the intent of the luxury tax: to prevent super teams and give small market teams a chance to contend. We still have to see if this works because obviously no collective bargaining agreement can stop dumb ass team owners and execs from doing dumb things. But, if a year from now, everybody is talking about the Timberwolves as an up-and-coming team because of decisions made this summer or the Grizzlies go back to the WCF despite the Clippers getting Doc Rivers and OKC getting Westbrook back for another playoff run, then we’ll see the whole league shift. Every team will be looking to operate efficiently on and off the court. That’s why all these analytics-driven GMs and coaches are gaining in popularity. Execs and MBA (no typo) types lean on numbers to understand things that most people “get” intuitively.

Leave Comment

You must be logged in to leave a comment. Not a member? Register now!

Featured video

Who will land Josh Smith?
Top 10 NBA Player Searches
  1. K. Durant (8656)
  2. K. Martin (6654)
  3. K. Bryant (6526)
  4. K. Leonard (6391)
  5. C. Bosh (6245)
  1. D. Williams (6083)
  2. T. Jones (5975)
  3. D. Rose (5887)
  4. T. Parker (5764)
  5. J. Smith (5638)