MLBPA Calls for “Competitive Integrity Tax” on Teams Spending Below $150M in Opening CBA Proposal

MLBPA made the first move in negotiations regarding the Collective Bargaining Agreement (CBA), which will expire on December 1, 2026.

MLBPA Calls for “Competitive Integrity Tax” on Teams Spending Below $150M in Opening CBA Proposal

MLBPA Interim director Bruce Meyer (Image via Imago)

In Short
  • MLBPA proposes a "Competitive Integrity Tax" for teams spending below $150 million.
  • The union seeks to raise the minimum salary for players from $780,000 to $1.5 million.
  • MLB rejects the proposals, citing concerns over competitive balance and potential payroll disparities.

On Wednesday, the Major League Baseball Players Association (MLBPA) made its first proposal regarding the Collective Bargaining Agreement (CBA). In this, they called for a “Competitive Integrity Tax” on teams that spend less than $150 million.

In recent years, teams like the Los Angeles Dodgers, the New York Yankees, and the New York Mets have spent millions on players. While these teams have dominated the market, some have not spent much.

According to reports from Spotrac, teams like the Miami Marlins, Cleveland Guardians, Tampa Bay Rays, Chicago White Sox, St. Louis Cardinals, Washington Nationals, Minnesota Twins, Colorado Rockies, Pittsburgh Pirates, Athletics, Milwaukee Brewers, and the Cincinnati Reds have a tax payroll below the $150 million mark.

The proposed ‘competitive integrity tax’ could see these teams get punished for spending low. This tax could act as a soft floor. However, instead of punishing teams for going over a certain limit of spending, teams will be subjected to fines for going under a base level.

Apart from this, the MLBPA also proposed an increase in minimum salary and the CBT threshold. At the moment, the minimum salary of an MLB player is $780,000. The MLBPA wants this to be increased to $1.5 million.

As for the CBT threshold, the union proposed its limit to be increased to $300 million. During the MLB lockout in 2022, this threshold was increased upto $230 million. Since then, there has been a gradual increase, and it stands at $244 million today.

A long labor battle is expected to take place between the union and the league. The team owners are likely to push for a salary cap. Among the Big 4 leagues in the United States, the MLB is the only one that does not feature a salary cap.

In the last offseason, the talks of implementing a salary cap grew even more following the spending of the Dodgers. The 2-time defending champions splashed the cash once again to bring in Edwin Diaz and Kyle Tucker. Their signing of Tucker left some owners “raging,” with reports expressing that they will push for a salary cap in the new negotiations.

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MLB cites the Dodgers while turning down the proposals by the MLBPA

The MLBPA made the first move towards the talks of a new CBA on Wednesday. However, it did not take too long for the league to respond. The MLB cited the Dodgers while turning down the proposals by the MLBPA.

Rob Manfred
MLB Commissioner Rob Manfred (Image via Imago)

In a statement, MLB spokesperson Glen Caplin expressed that they appreciated the union for making these proposals. The league, though, claimed that the proposals by the MLBPA did not address the situation but, in fact, exacerbated the competitive balance problem the fans had been pointing out on social media.

Unfortunately, they do not address and in fact exacerbate the competitive balance problem our fans are telling us we must address.

The MLB said in their statement towards the MLBPA’s proposal

The league then pointed out that the MLBPA’s proposal to reduce the amount to lower-revenue clubs would weaken the Competitive Balance Tax.

The MLBPA’s proposal would reduce the amount transferred to lower-revenue Clubs, weaken the Competitive Balance Tax, and lead to even more payroll disparity than exists today. For example, under the Union’s proposal, the Dodgers would pay less in luxury tax payments, giving them an additional $70 million to spend on payroll.

The MLB added

There are some concerns regarding a potential lockout if the union and the league fails to reach terms regarding the new CBA. The current CBA expires on December 1, 2026.

During the 2021-22 offseason, there was a 99-day lockout following the expiration of the CBA. The owners locked out the players, which led to a delay in the start of the 2022 Spring Training and the new season.

In 1994-95, there was a major strike that led to the cancellation of 948 games, including the 1994 postseason and the World Series. If there is a failure to reach terms this time out, a similar lockout is expected. Only time will tell what will happen next.

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