Toronto Maple Leafs used major tax advantage to sign Chris Tanev as a free agent
The Toronto Maple Leafs were able to utilize a major tax advantage when signing free agent Chris Tana of on July 1st.
Despite everything you hear, Canadian teams in the NHL are not always at a disadvantage. Despite the country's high tax rates for those who understand tax law, there are truly some advantages that teams can take advantage of. That was on full display on July 1st when the Toronto Maple Leafs signed top defensive free agent Chris Tanev.
Tanev, 34, was viewed as the top defensive free agent target for most teams. His rugged style is exactly what most teams covet when trying to build a Stanley Cup defense. That is why the Maple Leafs put a priority on signing the defender and traded a draft pick to ensure an exclusive negotiation window.
The two parties ultimately agreed to a contract 6 years in length worth 4.5 million per season. The deal will see Tanev remain in Toronto until he's 40 years old, while the deal has faced much criticism, the Maple Leafs also used lesser known tax to secure the deal.
In a recent interview Tanev discussed the tax that can be levied against Canadians moving to the United States.
Despite playing in Dallas, Tanev was not subject to these taxes as he had only departed for a short time. However, should he have signed a long-term deal he would have been faced with these taxes. Leaving Canada would have also left him vulnerable To capital gains taxes on assets remaining in Canada.
For someone like Tanev, who has played so long in Canada? It just wasn't worth it. Combined with the Maple Leafs forking over over $21 million in bonus money, it was difficult for him to say no.
This is an interesting twist, especially given how many times we hear that Canadian teams are at such a significant disadvantage. For once, taxes in Canada truly helped the Maple Leafs.
Source: The Hockey News Chris Tanev Revealed That a 'Departure Tax' When Leaving Canada Was a Consideration Before Ultimately Signing With Maple Leafs
| POLL | ||
6 AOUT | 119 ANSWERS Toronto Maple Leafs used major tax advantage to sign Chris Tanev as a free agent Where would you rather play? | ||
| Canada | 48 | 40.3 % |
| United States | 53 | 44.5 % |
| No preference | 18 | 15.1 % |
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