This NBA season, the salary cap was $109.1 million and the luxury tax line was $132.6 million. Next season was projected to jump to a $115 million cap and a $139 luxury tax line (that was after the impact from the NBA’s issues with China were factored in).
Then the coronavirus hit. The NBA and the players’ union are still negotiating next year’s cap and tax, but it is not expected to drop below $109 million.
However, teams had been budgeting for that $139 luxury tax line and are now lobbying the league to keep the tax line high, in part to allow player movement, reports Bobby Marks of ESPN.
The teams with cap space are largely teams out of the playoffs — Atlanta, Charlotte, New York, Detroit — that some free agents would not choose.
Keeping the tax line closer to $139 also helps teams that budgeted to be a few million below that number but could find themselves unexpectedly over the tax line and either paying it or dumping salary.
There is no set date for when the salary numbers will come out, but teams need to know the numbers (or approximately what they will be) before the 2020 NBA Draft on Nov. 18. It would be next to impossible to execute draft night trades without knowing the salary cap and tax numbers.