Yankees lower luxury tax bill for second straight year

Updated: December 24, 2007, 5:44 PM ET
Associated Press

NEW YORK -- The New York Yankees did accomplish something this year: They lowered their luxury tax for the second straight season.

The Yankees were hit with a tax bill of $23.88 million by Major League Baseball in a notice sent to teams late Friday, pushing them over the $100 million mark since the penalty for profligate spending was introduced in 2003.

The only other club that must pay the competitive-balance tax, as it is formally known, is the World Series champion Boston Red Sox, who owe $6.06 million.

Checks are due at the commissioner's office by Jan. 31.

New York's bill is down from $26 million last year and a high of $33.98 million in 2005. In all, the Yankees have run up taxes of $121.6 million in five seasons with no World Series title to show for it.

The Yankees' tax total would have dropped even lower had they not signed Roger Clemens in midseason. The Rocket went 6-6 with a 4.18 ERA in 18 appearances, and he cost New York a $6.98 million tax increase in addition to the $17,442,637 in salary he earned.

He left Game 3 of the Yankees' first-round playoff series against Cleveland in the third inning because of an injured hamstring. New York won the game but was eliminated by the Indians the following night.

Boston will be paying tax for the fourth straight season but the bill for the Red Sox has been only a fraction of what the Yankees have paid. Boston's four-year total is $13.86 million, including just $497,549 in 2006.

The only other team to pay tax was the Angels, who owed $927,059 for 2004.

New York's payroll was $207.7 million and Boston was second at $163.1 million for luxury tax purposes, which uses the average annual values of contracts for 40-man rosters and adds benefits. Both teams pay at a 40 percent rate for the amount over the tax threshold, which rises from $148 million this year to $155 million next season.

New York figures to lower its payroll without Clemens next year -- unless the Yankees acquire Johan Santana from Minnesota and sign the two-time AL Cy Young Award winner to a big extension.


Copyright 2007 by The Associated Press