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Warriors CEO/co-owner Joe Lacob calls NBA luxury tax “unfair”

2022 NBA Finals - Golden State Warriors v Boston Celtics

BOSTON, MA - JUNE 16: Owners of the Golden State Warriors, Joe Lacob and Peter Guber, hold The Larry OBrien trophy after Game Six of the 2022 NBA Finals on June 16, 2022 at TD Garden in Boston, Massachusetts. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, user is consenting to the terms and conditions of Getty Images License Agreement. Mandatory Copyright Notice: Copyright 2022 NBAE (Photo by Joe Murphy/NBAE via Getty Images)

NBAE via Getty Images

Truth can be a matter of perspective.

When the Warriors won the NBA title, there were whispers from other teams it was a “checkbook title” because Golden State paid an NBA record $170 million in luxury tax and $346 million in total payroll. Not every franchise could afford to do that.

From Warriors CEO/co-owner Joe Lacob’s perspective, the league’s luxury tax is unfair because it punished his team for drafting, developing, and keeping its core together (players including Stephen Curry, Kla Thompson, and Draymond Green).

Lacob went on the “Point Forward” podcast with Andre Iguodala and Evan Turner and said this (hat tip NBC Sports Bay Area):

“The hardest thing of all is navigating this luxury tax, unfortunately. I went back to New York this week for labor meetings. I’m on the committee. And you know, obviously, the league wants everyone to have a chance and right now, there’s a certain element out there that believes we “checkbook win,” we won because we have the most salaries on our team.

“The truth is, we’re only $40 million more than the luxury tax. Now, that’s not small but it’s not a massive number. We’re $200 million over in total because most of that is this incredible penal luxury tax. And what I consider to be unfair and I’m going to say it on this podcast and I hope it gets back to whoever is listening ... and obviously it’s self-serving for me to say this, but I think it’s a very unfair system because our team is built by -- all top eight players are all drafted by this team.”

Iguodala immediately noted that the Warriors did not draft Andrew Wiggins; they took on his max salary.
“Right. And we have guys that were undrafted and we found and developed in Santa Cruz. We had not one free agent who isn’t a minimum. Not one. All minimums the guys we brought in this year. So the only guy you could make a case for us outspending the competition, not being fair is that we turned [Kevin] Durant leaving into one guy who turned into Wiggins, and that worked out great. But they all criticized us for doing it, said he was overpaid and that [we] did a bad deal. So you can’t have it both ways.”

Again, it’s all a matter of perspective.

Lacob and the Warriors are playing by the rules as currently set up, where the tax is incremental (the higher a team goes over the tax line, the steeper the tax). Golden State’s luxury tax bill will go up slightly next season to $141 million (estimated, it depends on in-season moves), but that could be second to the Los Angeles Clippers, who are on pace to have a $144 million tax bill. Teams in the luxury tax also face restrictions on other mechanisms of team building (a smaller mid-level exception, they are hard-capped by a sign-and-trade or other moves).

It is possible in the currently-being-negotiated next CBA there will be more steps to discourage teams from going way over the tax line. However, if Lacob and the Warriors — who own the new Chase Center, which prints money — or Steve Ballmer and the Clippers (he’s just stupid rich) want to spend, there are limits to what the CBA can do. (Short of a hard cap, and the players would NEVER go for that.)

Competitive owners and teams will always push the limits and the rules to find an edge to win. There is no bigger advantage in all professional sports than a committed and willing to spend ownership — the Warriors have that. And the banners that came with it.