Author Topic: Competitive Balance Tax  (Read 6414 times)

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Offline JCA-CrystalCity

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Re: Competitive Balance Tax
« Reply #75: March 05, 2018, 04:43:46 PM »
Article from Forbes says the Nats won't sign Arrieta because of CBT.

https://www.forbes.com/sites/waynemcdonnell/2018/03/05/perfect-in-theory-for-fans-but-arrieta-and-nationals-are-a-tax-mismatch/#4540ebb88e5f
Quote
To add an additional layer of complexity to an already confusing situation, Arrieta was extended a qualifying offer by the Cubs for $17.4 million. He declined the offer and now the Cubs will receive a compensatory pick after the Competitive Balance Round B of the 2018 Amateur Draft. If the Nationals do indeed sign Arrieta, they would have to forfeit their second highest and fifth highest remaining selections in the draft as well as see a significant decrease ($1 million) in its International Signing Bonus Pool.

I think the bolded text is the bigger reason they will not sing Arrieta than the lux tax implications.  This system is top heavy and is pretty dependent on the Dominican and Caribbean signees for what quality  they have in the system.  Losing $1MM in the bonus pool is a big penalty for them, and a 2 and a 5 should get them one contributor, too.