Sunday, January 26, 2014

NyPo: "Masahiro Tanaka Is Going to Pay Taxes Up the Wazoo"

NyPo has the report on the Japanese phenom the Yankees just signed:
Welcome to New York and Yankee pinstripes, Masahiro Tanaka.

And get ready to pay up the wazoo.

Tanaka is the Japanese pitcher the Yankees signed this week to a seven-year, $155 million contract. And guess what? Taxes will claim more than half of it.

Americans for Tax Reform did a back-of- the-envelope calculation of Tanaka’s tax burden. They reckon that over the seven years of his contract, his decision to play for the Yanks will mean a combined marginal tax rate of 56.1 percent in federal, state, city and Medicare payroll taxes[...]

Maybe if, like Tanaka, your dream is to pitch the winning game at Yankee Stadium in the World Series, you’re willing to pay that premium — especially when you still get to keep the remaining $68 million.
But not everyone is willing to make that tradeoff. When the Mariners lured Yankee second baseman Robinson Cano to Seattle recently, The Post noted he would save $42 million, because Washington state has no income tax.

The more pertinent point, of course, is that most of those who are making tax-tradeoff decisions are not star athletes. They are business people who have to decide what’s best for their bottom line.
And when high taxes and high spending make New York a “luxury product,” more people are bound to conclude they can’t afford it.
 Here's Tanaka striking out six batters during two innings of work for Japan in against Cuba.

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