The Cavs Paid An Enormous Luxury Tax To End Cleveland's Title Drought

By on July 9, 2016 in ArticlesSports News

The Cleveland Cavaliers made a comeback against the Golden State Warriors in this year's NBA Finals that was historic for a number of reasons: it was the first time a team had come back from a 3-1 deficit in the NBA Finals; Kyrie Irving and LeBron James became the first teammates to score 40 points apiece in an NBA Finals game; and the Game 7 victory ended a 52-year title drought for the city of Cleveland.

Their luxury tax bill in the off-season following their championship will also go down as one of the highest ever. Cavs owner Dan Gilbert has to pay $54 million in taxes to the league.

The league's annual audit established next season's salary cap at $94.1 million, and confirmed that seven teams, led far and away by Cleveland, surpassed the $84.7 million tax threshold for the 2015-16 campaign. Next year's tax threshold will be $113.3 million.

BECK DIEFENBACH/AFP/Getty Images

BECK DIEFENBACH/AFP/Getty Images

Cleveland has until the month is over to pay its bill. The other teams that owe money in luxury tax are the Los Angeles Clippers, who owe $19.9 million in luxury tax, the Golden State Warriors ($14.8 million), the Oklahoma City Thunder ($14.5 million), the San Antonio Spurs ($4.9 million), the Houston Rockets ($4.9 million) and the Chicago Bulls ($4.2 million). Only the Bulls failed to make the postseason with their expensive roster.

If you're scoring at home, the other six teams spent $63.2 million between them. Again, Cleveland spent $54 million, only around $9 million less than the other six teams, combined.

In total, that's about $114 million in luxury taxes across the league. Thanks to the league's revenue-sharing plan, 50 percent will be used to fund revenue sharing for the previous season, while the other 23 non-tax-paying teams will take home the remaining 50 percent. That works out to about $2.5 million per team.

While Gilbert's wallet will certainly be aching, at least he can take some comfort in knowing his overspending brought him a championship. The Brooklyn Nets have the all-time record for highest luxury tax, spending a whopping $90.5 million in tax alone during the 2013-14 season. Unlike Brooklyn, that season ended in a second-round exit for the Nets. Sometimes it pays to overspend.

Articles Written by Joey Held
If there's a story anywhere in the world of music, sports, or entertainment, Joey wants to tell it. He's been freelancing since 2010, and prior to that, he attended the University of Miami, where he double majored in broadcast journalism and sport administration. A Chicago native, Joey currently resides in Austin, TX. Follow him on Twitter and Google+ and always feel free to suggest a song for his next karaoke performance.
Did we make a mistake?
Submit a correction suggestion and help us fix it!
Submit a Correction
Discussion