CHICAGO, UNITED STATES: Major League Baseball Player Association Executive Director Donald Fehr fields question from the media following a meeting in Chicago 12 August 2002. The player’s association executive board decided to take no formal action to set a strike date. Players and owners reportedly have reached agreement on minimum salaries and financing of the benefit plan. The sides still are discussing revenue sharing, a luxury tax and a worldwide draft. AFP PHOTOS/Scott OLSON (Photo credit should read SCOTT OLSON/AFP via Getty Images)
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In Major League Baseball social media comments, baseball fans calling for a salary cap and salary floor have never been louder.
The current Collective Bargaining Agreement between the Major League Baseball Player’s Association and Major League Baseball expires at the end of the coming World Series.
Some Major League Baseball owners are trying to add a cap on team payroll spending to the new basic agreement.
Major League Baseball is the only major sport without a salary cap.
The Major League Baseball Player’s Association has long opposed any form of cap on potential earnings for their players.
Without the Player’s Association support, it would seem MLB teams will continue to spend what they wish on players salaries.
MLB does have a “Luxury Tax” in place to help deter teams from wildly spending.
The Luxury Tax was first proposed in 2002, when Donald Fehr led the Player’s Association.
Teams are taxed if their payroll exceeds certain thresholds.
For the 2026 season, the thresholds are $244M, $264M, $284M. and $304M.
spotrac.com notes 11 teams currently exceed at least one 2026 Luxury Tax threshold.
Here are the projected tax payrolls of each of those teams. Note: These are NOT the active payrolls of teams current rosters. They include all player payroll obligations the teams have at this time. They do not include only active roster players.
GLENDALE, ARIZONA – FEBRUARY 13: A detail view of a Los Angeles Dodgers logo during spring training workouts at Camelback Ranch on February 13, 2025 in Glendale, Arizona. (Photo by Brandon Sloter/Getty Images)
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Los Angeles Dodgers=$413,597,413
New York Mets=$359,018, 064
Philadelphia Phillies=$325,895,437
Toronto Blue Jays=$312,390,459
New York Yankees=292,340,833
Boston Red Sox=$276,113,051
San Diego Padres=$268,643,678
Atlanta Braves=$266,895,000
Chicago Cubs=$256,842,380
Houston Astros=248,594,994
San Francisco Giants=$226,874,836
Rounded off, 36.7% of Major League Baseball franchises are currently over the MLB Luxury Tax thresholds.
While fans of those teams may be happy with the payroll spending of their favorite team, the current structure leads a huge, ever-increasing gap between teams that wish to spend money on player payroll, and teams that choose a more frugal approach.
To this old scout, every Major League Baseball owner, or ownership group has the financial wherewithal to field a team with a minimum of a $150M payroll.
How owners, and ownership groups choose to spend their resources is a private, personal matter.
However, there are several MLB franchises that have heard the wrath of their fans for their frugal payroll spending.
According to spotrac.com, here are the remaining MLB franchises player Tax Payrolls. Again, these are the team’s payroll obligations at this time. They do not include only active roster players.
Note: Teams that are currently below $150M in current, active roster salaries are listed with parentheses. The total amount of their current, active payroll is listed.
12 teams fall below the $150M payroll category.
With the exceptions of Cleveland, and Milwaukee, the remaining 10 teams did not make the 2025 playoffs.
WEST PALM BEACH, FLORIDA – MARCH 15: A closeup view of the Miami Marlins logo prior to a spring training game against the Houston Astros at CACTI Park of the Palm Beaches on March 15, 2025 in West Palm Beach, Florida. (Photo by Nick Cammett/Diamond Images via Getty Images)
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Miami Marlins= $100,966, 666 ($60,840,000)
Tampa Bay Rays=$108,776,666 ($80,670,000)
Cleveland Guardians=$117,184,625 ($78,342,857)
Chicago White Sox=$128,046,666 ($89,280,000)
Pittsburgh Pirates=$133,890,416 ($99,223,750
Washington Nationals=$136,524,166 ($66,037,500)
Minnesota Twins=$140,039,380 ($99,370,714)
St. Louis Cardinals=$142, 791,666 ($67,305,000)
Colorado Rockies=$143,213,095 ($111,006,429)
Athletics=$144,347,856 ($108,861,190)
Cincinnati Reds=$150,109,999 ($107,003,333)
Milwaukee Brewers=$155,586,666 ($122,560,000)
Seattle Mariners=$195,785,333
Kansas City Royals=$197,355,858
Baltimore Orioles=$197,918,666
Detroit Tigers=$200,286,249
Los Angeles Angels=$202,407,689
Texas Rangers=$215,391,666
Arizona Diamondbacks=$225,346,577
What Do The Numbers Show?
Basically, major league team payrolls do, indeed, equate to success.
Only a few teams bid on, and sign marquee, game-changing players.
Owners and ownership groups willing to enter the deep end of MLB free agent pools have basically remained the same for years.
WASHINGTON, DC – APRIL 25: the New York Mets logo shown on a ball bag during batting practice prior to a baseball game against the Washington Nationals at Nationals Park on April 25, 2025 in Washington, DC. (Photo by Mitchell Layton/Getty Images)
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The Mets, the Dodgers, the Phillies, the Blue Jays, the Giants, and often the Yankees enter high stakes bidding wars to sign the game’s consequential free agents.
This year, the Orioles and Red Sox entered the deep end of teams interested in the highest ranked free agents.
While the Yankees have been relatively quiet so far, it is still likely they could sign a top, expensive, remaining pitcher or position player.
The numbers also show a payroll floor would be welcomed by players, and fans.
But would some owners object to a payroll floor? Especially without a payroll cap?
Stay tuned. Negotiations on the new Collective Bargaining Agreement will be very telling.
To this old scout, the MLB Luxury Tax system isn’t working.
Source: https://www.forbes.com/sites/berniepleskoff/2026/01/20/luxury-tax-isnt-holding-down-major-league-baseball-payrolls/
