The NBA withheld 15% of player salaries last season to ensure revenue splitting was achieved. The increase in income during that season means that players will ultimately retain 97.35% of their salaries from the 2022-23 games. The league will keep 2.65% of the $4.5 billion in player contracts for the 2022-23 season.
The NBA recently completed its financial audit of the 2022-23 season and found the business rebounded strongly from deficits caused by COVID-19. For the players, it means the return of almost the entire guarantee fund retained during the season, a total amount of almost $700 million.
The collective bargaining agreement between the players and the league calls for players to receive 51% of basketball-related revenue. The NBA withheld 15% of player salaries last season to ensure revenue splitting was achieved. The increase in income during that season means that players will ultimately retain 97.35% of their salaries from the 2022-23 games.
The league will keep 2.65% of the $4.5 billion in player contracts for the 2022-23 season.
Stephen Curry He was the highest paid player in the NBA last season and originally had $7.2 million withheld from his $48.1 million salary.
The escrow system was implemented during 1999 and was traditionally set between 8% and 10% of player compensation. The players and the league split the escrow for many seasons, but for three consecutive seasons starting in 2014-15, 100% of the escrow was returned to the players along with a supplemental check as revenue increased and produced an unequal division.
When he arrived COVID-19 In March 2020, the league increased the escrow percentage at the end of the season to 25% to compensate for the drop in revenue due to lack of fans. The following season, a “ten and spread” system was implemented to supplement the standard 10% withholding amortized over a three-year period. There was still a carryover of around $130 million for the 2022-23 season. The entire guarantee fund for 2022-23 would have been returned to the players if not for that remaining deficit.
The escrow system of the NBA It has rarely been a major problem for players, because most of the funds were returned to them as income grew at the same rate as the contracts of players who even received additional compensation under the system between 2014 and 2017. .
The NBA system seems to be working for both sides. The average team is worth $4 billion, up 70% over the past three years, while 75 players are expected to earn at least $20 million this season. The list is led by Stephen Curry with $51.9 million.
Source: Ambito
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