Red Sox avoid luxury tax penalties – let the spending begin
By Rick McNair
Boston Red Sox owner John Henry has told Dave Dombrowski that he can now spend. This is the result of a luxury tax reset that lessens the payroll penalties for Boston.
The Boston Red Sox fans and media have a shopping list and it is not down the house goods aisle at Target, but among the pricey trinkets at Tiffany’s. According to a Boston Herald snippet by Chad Jennings senior management – in other words, owner John Henry – has decreed it is time to spend. Do I hear a “Hallelujah?”
The Red Sox came in under the luxury tax threshold (LT) for the previous season – thank you, Philadelphia – and that will lower the penalty to 20% for going over the $197 million cliff. If the Red Sox had not been so diligent they would have the 50% hammer fall upon them.
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This is like the famous television commercial about paying me now or paying me later. By doing a fiscal Wallenda Family fiscal tightrope the Red Sox managed a reset. Reset is the code word in the whirlpool of LT. So now the Red Sox move forward with Dave Dombrowski and baseball operations having both a blessing from above and a wish list.
The Red Sox have a few issues facing the fiscal calendar with the first being arbitration and just how much that hit will be. The second and most public and prominent issue is the free agent roundup. The Red Sox needs are not lengthy, but clear. A slugger or two or three and some pitching – especially an arm out of the bullpen. Maybe even a less than slugger component such as Eduardo Nunez may be in the mix. Sure, hope so.
"“He said he could go over.” – Dave Dombrowski on John Henry payroll directive."
Free-agent shopping is where things may just come crumbling down like the walls of Jericho. It is not how much you spend, but how wisely you spend. One need go no further than the busts of all busts in Pablo Sandoval and Carl Crawford. Maybe they’ll get it right?
With the addition of payroll comes the inevitable of passing it down the line. We see this with our governments where excruciating fiscal decisions are often ignored. For Boston, it comes down to the projected payrolls and the increase in the LT threshold. You can – as I have – venture into the Red Sox contracts, but I would suggest an adult beverage be close at hand.
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The end results will be the ultimate determining factor and that will not be known until late October of 2018. If the Red Sox make the right choices, avoid a long list of injuries, and the players collectively have career years no one will give a hoot about the LT – especially management and most notably John Henry.