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1st of all they haven't decided whether it will or won't be paid this year. From what I read it was the previous year that it was paid. However with the NEW CBA. Still there has been a lot done by owners to cut spending the last year and revenues still are increasing. Add to that the fact that probably several hundred millions of dollars of salary will be exempted from counting against the salary cap over the next few years, I feel that the chances are better that it won't happen than that it will. But it's still a crapshoot. No one will know for sure until sometime in July 2006 if there will or won't be a luxary tax for this coming season.
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This is the Chad Ford blurb that I was basing my information on:
Last season, teams whose payroll exceeded $54.6 million paid a dollar-for-dollar tax on the amount they were over the threshold.
I don’t know if by last season he meant the 2003-2004 season or the one that just ended but either way, it doesn’t change my point. The last time the luxury tax was calculated, it was instituted so we know that BRI was over 61%. As I pointed out the new CBA has provisions that are likely to increase salaries.
I’m not sure where you’re getting the several hundred million dollars in overall salary savings over the next few years.
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Of course most of the owners will try and keep it as close to 57% as possible.
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How will they manage to do this when 1) They’re making decisions independent of one another and 2) The calculation isn’t done until the season ends? To me (and to the people that have access to the books) it seems unlikely that they’ll stay within that 4% window.