Yankees hit with $28M luxury tax
NEW YORK — The New York Yankees were hit with a $28 million luxury tax bill, pushing their total past the $250 million mark since the penalty began in 2003.
According to Major League Baseball calculations sent to teams Tuesday, the Los Angeles Dodgers are the only other team that exceeded the tax threshold this year and must pay $11.4 million. Boston finished just under the tax threshold for the second straight year, coming in $225,666 shy of the $178 million mark.
Figures include average annual values of contracts for players on 40-man rosters, earned bonuses and escalators, adjustments for cash in trades and $10.8 million per team in benefits.
Because the Yankees have been over the tax threshold at least four consecutive times, they pay at a 50 percent rate on the overage, and their $28,113,945 bill was second only to their $34.1 million payment following the 2005 season. New York’s total since MLB and the players’ union instituted the tax is $252.7 million.
New York has said it hopes to remain under the threshold next year, when it rises to $189 million, but the Yankees already are just about at that figure with commitments to 15 players. Their only hope to get below the threshold appears to be if Alex Rodriguez is suspended for most of the season and they don’t have to pay much of his $25 million salary.
The Yankees finished with the highest regular payroll for the 15th consecutive year, winding up at a record $237,018,889. The Dodgers were just $146,647 behind.
Regular payrolls include salaries and pro-rated shares of signing bonuses.
Los Angeles had a higher payroll for the tax: $243 million to New York’s $234 million. But because the Dodgers didn’t exceed the threshold in 2012, they pay at a 17.5 percent rate and owe $11,415,959.
Checks to the commissioner’s office are due by Jan. 21.
Houston, which lost more than 100 games for the third straight season, had a payroll less than one-eighth that of the Yankees and Dodgers. The Astros’ finished at $29.3 million, the lowest total in the major leagues since the 2008 Florida Marlins.
After trading many of their stars following an unsuccessful first season in their new downtown ballpark, the Marlins lowered their payroll to $42.3 million from $111.8 million in 2012.
The average salary increased 7.1 percent, to $3,326,645 from $3,105,093, according to MLB’s calculations, the steepest rise since 2006. The players’ association has not yet released its final figures for this year.