For the first time in franchise history, the Philadelphia Phillies decided to surpass the $230 million luxury tax threshold when they signed Nick Castellanos to a five-year/$100 million deal before the season.
With the in-season additions of David Robertson, Noah Syndergaard, Edmundo Sosa and Brandon Marsh, Ronald Blum of The Associated Press reports that the team’s payroll now sits at $243 million. Because the Phillies are over the first luxury tax threshold of $230 million but under the second threshold of $250 million, Blum says they’ll owe $2.6 million. That feels like a relative drop in the bucket for managing partner John Middleton and company when you consider the payroll as a whole.
With Robertson, Syndergaard, Jean Segura and Didi Gregorius all coming off the books after this season, it’s possible that the Phillies could duck back under the $230 million luxury tax threshold in 2023. That would reset the tax, meaning they would pay a 20% tax on the amount of money over the first threshold if they went back over it in 2024 or any time in the future.
However, the Phillies have already been linked to Trea Turner and Xander Bogaerts, two star shortstops who can become free agents after the season. If the Phillies were to sign either of those two or end up over $230 million for the second consecutive season, the tax would increase from 20% to 30%.
In addition to the Phillies — who have the fourth-highest payroll in baseball this season — the New York Mets, Los Angeles Dodgers, New York Yankees, Boston Red Sox and San Diego Padres will also owe luxury tax penalties.
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