New agreement includes draft-pick penalties.
The latest Collective Bargaining Agreement was sent to clubs to be ratified in June, and it also was made public on the union’s Twitter feed. Baseball America examined the agreement and found some interesting additions that will affect the way teams spend both domestically and internationally.
In the past, the CBA has instituted a luxury tax to charge teams that spend past a certain threshold on major league payroll.
But that’s just money. This time the CBA includes draft pick penalties for big-spending teams.
The new CBA adds two surcharge thresholds on top of the competitive balance tax that was included in the previous CBA. Spend more than $217 million in 2018 and a team will be hit with an additional 12 percent tax on top of the 20 percent, 30 percent or 50 percent tax they incur (depending on how many consecutive years they have exceeded the tax threshold).
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