California’s High Tax Rate Hurt Dodgers, Giants Chances of Signing Bryce Harper

Bryce Harper
AP Photo/Yong Kim

By turning his back on offers from the Los Angeles Dodgers and San Francisco Giants, outfielder Bryce Harper will save himself millions in taxes.

The star outfielder, who just signed a 13-year, $330 million contract with the Philadelphia Phillies, fielded offers from those California-based teams but ended up deciding that the offers just weren’t good enough.

The Giants, for instance, reportedly offered a 12-year, $310 million deal. But the tax rate in California was just too high, Harper’s agent says.

According to the Los Angeles Times, California has the “highest state rate in the nation, topping out at 13.3%.”

But by choosing the Phillies, Harper is saving himself millions.

The Times added:

By contrast, Pennsylvania has a low flat rate for every taxpayer regardless of income. It’s just 3.07%. That’s one reason why superstar slugger Bryce Harper signed an eye-popping 13-year, $330-million contract last week with the Philadelphia Phillies, spurning the Dodgers and Giants.

USA Today baseball reporter, Bob Nightengale, noted that Harper wanted at least $335 million over 12 years from the Giants so that he would not lose so much in taxes.

Scott Boras, Harper’s agent, noted that the difference between the two tax rates is “dramatic.” Boras added, “It could be almost a full year’s compensation.

“The Giants, Dodgers, and Padres are in the worst state income tax jurisdiction in all of baseball,” Boras said. “Players really get hit.”

Another sports agent, John Boggs, agreed with Boras. Many players take one look at what they will lose in taxes by joining teams in high tax states that they turn around and walk away.

“It’s a red light,” Boggs said. “I’ve had players in the past say they don’t want to go to certain states because they’re going to get hammered by taxes. Obviously, that affects the bottom line.”

Follow Warner Todd Huston on Twitter @warnerthuston.

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