The Toronto Blue Jays will not play their home games during this 60-game abbreviated Major League Baseball season at the Rogers Centre because of the coronavirus by decree of the national Canadian government.
An unintended consequence of that decision will create a tax windfall for Blue Jays players, according to a New York-based sports tax accountant.
With 30 “home” games being played this year in the U.S. rather than Toronto, the players will pay taxes on payroll at a U.S. federal rate of 37-percent rather than the 53.5-percent national rate in Canada.
“They’ll save a little bit of money there,” said Robert Raiola, director of sports and entertainment at the accounting firm of PKF O’Conner Davies. “They’ll probably have to pay a jock tax if they play in the states, but it won’t be as high if they play in Toronto.”
The Blue Jays will have to pay, depending where they play. If games are held at either at a Triple-A ballpark in Buffalo, N.Y., or the Blue Jays’ spring training facility in Dunedin, Fla., the players would then have to add the appropriate state tax: 9-percent in New York, or zero percent in Florida, which has no state income tax.
“If you pay 37 and nine, it’s still better than 53,” Raiola said. “All the Blue Jays players would’ve been paying Canadian tax. Teams like the Mets and Yankees traveling to Toronto and playing road games there don’t pay the Canadian tax. So, it’s definitely a savings to Blue Jays players.”
For example, the Blue Jays top paid player, pitcher Hyun-Jin Ryu, is earning a prorated salary of $7.4 million of his $20 million this season for the 60 games. If the team plays in Florida, his federal tax burden will be $1.37 million, rather than $2 million had those 30 home games been staged in Canada.
Though the Blue Jays were able train in Toronto the last few weeks while remaining quarantined at the hotel connected to the ballpark, the national government in Ottawa wouldn’t wave the 14-day quarantine period for players of both the home and opposing teams to cross back and forth from the U.S. during the regular season. The season is set to begin Thursday, and the Blue Jays’ first game is Friday at Tampa Bay.
As of Sunday, Canada had 111,875 confirmed COVID-19 cases and 8,892 deaths, according to numbers provided by Johns Hopkins University School of Medicine. In comparison, U.S. cases were above 3.7 million and deaths at 140,131. The population of Canada is 37.59 million – 2.93 million in Toronto – while the U.S. is 350 million.
“From the onset of discussions with league and government officials the safety of the broader community remained the priority of everyone involved,” said Mark Shapiro, the Blue Jays’ president and chief executive. “And with that, the club completely respects the federal government’s decision.”