The Dreaded Luxury Tax. That almost feels like the proper name for it since you seldom hear the words "luxury tax" without the word "dreaded" before it. The Celtics cut Shav and Fab to avoid the Dreaded Luxury Tax. The reasons have been explained several times over. It isn't just the harsher dollar costs. It is the restrictions you have on player movement as well. It is set to kick in next year and the Celtics, in a rebuilding year, are going to do all they can to avoid that tax bill from coming due.
So is this how they'll operate from now on? Pinching pennies and cutting bait on underdeveloped talent? I don't think so. In fact, I really don't think anyone can accuse the Celtics front office of being cheap. First they bought a pick for a guy that they are stashing overseas (Iverson). Next they committed big long term dollars to a coach that hasn't coached in the NBA and doesn't project to win a ton of games his first year or two. Next, they just completed a trade where they had to pay another team to take our cap hit for us (Melo). They are willing to spend money and I think they'll spend tax money again, ...once they are ready to be contenders once again.
Consider this provision in the CBA (call it a loophole if you like, but it is a rule that smart teams will play by and even take advantage of).
The first year of the repeater tax (2015) will only apply to teams that were also taxpayers in the three previous seasons — 2011-12 through 2013-14. So right now, only Boston and the Lakers are candidates. The Celtics will probably stay out of the tax this season, and the Lakers are clearing the books next summer. So I don’t think any team will be a repeater in 2015. Starting in 2016 a team is a repeater if they were taxpayers in any three of the previous four seasons (for 2016 that’d be 2011-12 through 2014-15). That means any team that was a taxpayer in either 2012 or 2013 would be a repeater if they are a taxpayer in both 2014 and 2015. Most teams will be able to avoid the repeater penalty. A few teams like Brooklyn probably won’t care. The system is set up — well, "set up" is probably a bad way to put it. I don’t think they did it intentionally — so that two years out of the tax buys you three years IN the tax without being a repeater. I think many teams will adopt this strategy.
Take a team like the Celtics, for instance, who had no problem committing to payroll that would put them over the tax threshold when they were trying to contend for a title over the last few seasons. They’re rebuilding this year and next at minimum, but after those two years out of the tax, they could add free agents and load up for another run at a title by spending whatever it costs for the next three seasons, all the while avoiding the dreaded repeater tax.
I could certainly see that happening. The Celtics could take it easy for a year or two, stay under the tax while developing great, young talent. Then they make another splash like they did in 2007 and make themselves another run, spending whatever it takes to get the job done. At least in theory.