Has there ever been a luxury tax?

[dude1394]

Since I cannot seem to get an answer to this in threads or on google, thought I would muck up a whole thread.

Has there ever been a luxury tax in the NBA? If so when?

[HexNBA]

according to some quick googles searches (variations of the search nba luxury tax payment ), there have been luxury tax payments in the 2002-2003 season and in 2004.

[vjz]

For more details about the tax payments for the 2002-03 season, go here.

Excerpts:

The NBA also has a so-called luxury tax system. This kicks in when league-wide player salaries exceed 61.1 percent of the BRI. If that happens then teams must pay a dollar for each dollar they are over the 61.1 percent threshold. Teams that were under the threshold get a 1/29th share of the revenue. If player salaries do not exceed the luxury tax limit than no team, regardless of its payroll, pays the tax.

For example, in 2001-02, the New York Knicks did not have to pay a luxury tax even though their team payroll was $85 million. That led some to wonder what the point of the salary cap was. As long as teams like the Los Angeles Clippers and Chicago Bulls spend little enough on salaries to keep league-wide salaries under the 61.1 percent threshold, teams like the Knicks and the Portland Trailblazers can continue to vastly exceed the cap without penalty.

But in 2002-03 that all changed. The Knicks, Trailblazers and 14 other teams did have to pay the tax because league-wide salaries exceeded the 61.1 percent threshold.

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The Dallas Mavericks said their operating loss for the season would be about what they paid in luxury taxes, which was $18.5 million.