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I know that this article is a bit late from when this topic was hot in the NHL world, but I really want to get my two cents in on this one.

Brian Rafalski, among many other NHL players, is very upset with the privilege tax that is being imposed by the state of Tennessee on NHL and NBA players. Why, you ask? Many players across the league will actually be paying to play games in Nashville (or Memphis, in the case of NBA players).

Let me explain the basis of the tax. Players from the NHL and NBA will have to pay $2,500 each to be afforded the opportunity to play in the state of Tennessee, with a limit of $7,500 per player in a year. Even players who end up not playing that evening are stuck paying the $2,500 tax. NFL players are exempt from this tax because the NFL had already enacted rules that would punish the state for taxing its players.

Players from the NHL and NBA will have to pay $2,500 each to be afforded the opportunity to play in the state of Tennessee, with a limit of $7,500 per player in a year. Even players who end up not playing that evening are stuck paying the $2,500 tax.

Now, I know that some of you are thinking "I don't feel sorry for these guys - they're making millions of dollars to play a game!" To an extent, I can understand that line of thinking. However, it really isn't fair to say that they make all of their money to play a game. Their jobs aren't like the rest of ours. We go to work, put in our time, and then we can go home and do whatever we please. In the case of athletes, their job is their life. They don't show up for the games, play, and then just go home and show up for the next game. They have to eat right and exercise virtually every day of their lives. They partake in public relations events. They have to deal with the media, and in some cities, they're hounded by reporters and fans alike. They spend a total time of about three months of the year on the road to play in other cities (even more if their team makes the playoffs) and away from their families. They can be traded without being asked if it's okay if they're uprooted and sent across the continent, or possibly to another country.

Keeping that in mind, I think it's more than fair to say that athletes are compensated for a lot more than simply "playing a game", so when I think of their salaries, I don't divide it by 82 (the number of games in the season), but by the number of days in the season. This year, the number of games in the season was 193. When you take a player who makes $750,000 a season and divide his salary among every day, he's making $3886 a day. And before you take out the $2,500 "privilege" tax, you have to take out the 18% escrow (which is basically a fee all players pay to make sure that the league and its owners don't lose money. Players are given this money back at the end of the year if the league at least breaks even; if they don't, the league keeps enough to make sure they don't lose money) and 40% in taxes. That leaves the player with $2,409 for that day. But when he plays in Tennessee, he'll have to give that up AND ends up shelling out $91 of his own money.

Allan Walsh, one of the NHL player agents recently tweeted a story about a player who was called up from the AHL to play for the NHL club. The player went on a road game to Nashville. The player was a healthy scratch and did not play. His salary for his day in Nashville was $2,059. Taken from that was the 18% escrow and 40% taxes. And then this player had to pay $2,500 on top of that. It's easy to see how this player had to pay money out of his own pocket for the possibility to play in the state of Tennessee. It's even worse that he didn't actually get to play!

Taxing out of state players isn't an uncommon practice - in fact, many states or cities participate in taxing athletes who come from out of town. However, their rates are much more reasonable. For example, I read about a tax rate that the city of Detroit had imposed on out of town athletes. The tax was 1.25% of 1/82 of an NHL player's salary. So, if a player makes $700,000 a season, 1/82 of his salary would be roughly $8,537, and 1.25% of that is about $107. That tax rate is a lot fairer than a flat $2,500, especially considering that not all players make the same amount of money.

There are two more things about this "privilege" tax that rubs me the wrong way. One, since it isn't an income tax, the players aren't able to deduct it from their taxes. And two, THE PEOPLE OF TENNESSEE DO NOT PAY A STATE INCOME TAX! In Tennessee, state income tax is limited to dividends and interest income only. I have a huge issue with out of state athletes paying such a ridiculous fee to play for one evening when they're making the area thrive by helping support their local economy (restaurants, hotels, etc.). They have imposed a tax that is just too high and not variable, and it just is not right. I'm really proud of Rafalski for speaking out about this, because it isn't even an issue that he himself has to deal with - he made $6 million this season. However, there are 16 players on the Red Wings who make less than $1 million a season, so it will make a dent in their earnings. It's nice to see a guy stand up and speak out against something even when it does not directly affect him.

So leave me a comment and let me know what you think - is this fair? Do you hate it as much as I do? Should the players refuse to play in Tennessee until the matter is resolved, or should they just suck it up?

Tags: nba, nhl, tennessee privilege tax