During a meeting with the players association on Monday, Major League Baseball came up with a new economic plan pertaining to the collective bargaining agreement, according to The Athletic.
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The league proposed a new first tier of the luxury tax, which is set at $180 million, the report stated. It will also have a new salary minimum of $100 million. This proposal would add another level to a system that is already currently in place. Taxation would begin at 25% for teams that are spending over $180 million, according to the report. The first luxury tax threshold is currently set at $210 million.
Clubs that pay the tax penalties would help the lower-spending teams, but it’s still not clear what would happen if a team doesn’t reach the minimum, according to the report. The Tampa Bay Rays, Baltimore Orioles, Miami Marlins, Detroit Tigers, Cleveland Indians, Pittsburgh Pirates and Seattle Seahawks all came into the 2021 MLB season with payrolls under $100 million, per Cot’s Contracts.
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On the other hand, the New York Yankees, Boston Red Sox, New York Mets, Philadelphia Phillies, Washington Nationals, Houston Astros, Los Angeles Angels, Los Angeles Dodgers and San Diego Padres all had payrolls that were over the $180 million mark.
If the league and the players association can’t come to an agreement before the CBA comes to an end on Dec. 1, it could lead to a lockout by the team owners.