With the nature of the NBA’s salary cap driven contracts and the league’s current, seemingly ever expanding, ability to generate revenue from massive media contracts, pretty much every year brings a new “most expensive roster ever” leader. This became big news during the 2022 Finals when reports came out stating frustrations with Golden States player wage bill and their attempt to “buy the title”.
What is the highest ever NBA Team Salary? The 2021-22 Golden State Warriors have the most expensive team salary in NBA history. Their official wage bill came to $184,024,769, which also generated an estimated $170,331,000 in Luxury Tax payments. The 2021-22 Golden State Warriors roster totalled around $354,355,000
That’s right. Almost $355 million.
That’s a huge number. Especially given that the 2021-22 Salary cap was “only” $112.4million.
Below we’ll have a look at how the Warriors got there, where their nearest rivals came in, whether they’ll beat this number next year and most importantly – what this might mean for the NBA going forward. But first, let us take you to Salary Cap School.
What is a salary cap?
The salary cap is the “maximum” amount of money a team can spend on their player salaries in any given season. This, of course, comes with MANY exceptions.
First we will look at how the amount of dollars the Salary Cap will be season to season is worked out (with 1 brief tangent).
In July every year the NBA estimates Basketball Related Income (BRI) – this is the tangent we’ll take in a moment. The Collective Bargaining Agreement (CBA) defines a percentage of the BRI that goes toward the Salary Cap. This base number is then refined by taking into account the accuracy of previous season’s estimates.
Basketball Related Income (BRI) – (AKA the brief tangent)
BRI includes any income received by the NBA, NBA Properties or NBA Media Ventures:
- Game gate receipts
- Broadcast rights
- Novelty, program and concession sales
- Game day parking receipts
- Proceeds from team sponsorships
- Proceeds from summer camps
- Proceeds from mascot and dance team appearances
- Proceeds from beverage sale rights
- 40% of proceeds from arena signage
- 40% of proceeds from luxury suites
- 45% – 50% of proceeds from arena naming rights
- Proceeds from premium seat licenses
- Proceeds received by NBA Properties for any NBA licensed product
Like any business the books need to balance.The CBA keeps owners focusing on players interests, which only seems fair as they are the main attraction. It states that 44.74% of Projected BRI, minus projected player benefits (like health and welfare benefits), divided by the current number of NBA teams, at the moment 30, forms the Salary Cap for the upcoming season. This means players get their fair share, but that NBA teams aren’t forced to operate at a financial loss due to massive player wage demands as seen in European Football.
The NBA operates a Soft Salary Cap. This is opposed to a Hard Salary Cap. What does this mean? Quite simply, with a hard cap you would not be able to go 1 cent over the stated Salary Cap number. However, with a soft cap there are exceptions and ways of paying your roster more than the stated Salary Cap number as long as you stay within certain rules. This does attract a luxury tax, which can quickly ramp up the money a Franchise is paying out on its roster.
What is Luxury Tax?
In the NBA Luxury Tax is a fee payable if your roster exceeds that season’s salary cap by a certain amount. This is, in theory at least, a punitive measure aimed at dissuading teams from spending too much on their rosters and breaking parity due to their owners’ deep pocket books. The luxury tax level is calculated by taking 61% of projected BRI, subtracting projected benefits then factoring in some adjustments, this figure is announced around the same time the Salary Cap is, in July each year. For every dollar a team exceeds the luxury tax level, they pay an increasing amount back to the NBA, depending on how much they go over the Luxury Tax Threshold. Detailed below
| NBA Luxury Tax Payments | |||
| $s over Threshold | Amount per $ | Increment Max | Cumulative $s |
| $0-5million | $1.50 | $7,500,000 | $7,500,000 |
| $5-10million | $1.75 | $8,750,000 | $16,250,000 |
| $10-15million | $2.50 | $12,500,000 | $28,750,000 |
| $15-20million | $3.25 | $16,250,000 | $45,000,000 |
| $20-25million* | $3.75 | $18,750,000 | $63,750,000 |
| $25-30million | $4.25 | $21,250,000 | $85,000,000 |
| $30-35million | $4.75 | $23,750,000 | $108,750,000 |
| $35-40million | $5.25 | $26,250,000 | $135,000,000 |
| *After $25m it increase 50c for every additional $5m over |
The NBA will then distribute this money across the league using the following criteria;
- Teams below the tax level receive 1/30 of the tax money
- A portion of any remaining money may be reserved by the league for “league purposes.”
- Any remaining tax money goes to all teams in equal shares. A team that pays luxury tax can receive some money back through this distribution.
In the 2021-22 season the Luxury Tax Threshold was set at $136,606,000. Only 7 of the 30 NBA teams went into the Luxury Tax. These were;
| Team | Payroll | Luxury Tax | Total Spent |
| Golden State Warriors | $175,858,992 | $170,331,206 | $346,190,198 |
| Brooklyn Nets | $169,286,329 | $97,731,568 | $267,017,897 |
| Los Angeles Clippers | $166,162,398 | $83,114,696 | $249,277,094 |
| Milwaukee Bucks | $160,245,385 | $58,647,698 | $218,893,083 |
| Los Angeles Lakers | $156,636,217 | $45,113,318 | $201,749,535 |
| Utah Jazz | $147,743,929 | $19,094,825 | $166,838,754 |
| Philadelphia 76ers | $145,249,786 | $13,876,627 | $159,126,413 |
As you can see, the Golden State Warriors far outstrip everyone else’s spending. Paying $72.5 million more than second placed Brooklyn in Luxury Tax. The eagle eyed among you will notice that the Warriors salary was only $6.5 million above the Nets. That’s not dollar for dollar!? So what gives? What gives is “The Repeater Tax”.
What is the NBA Repeater Tax?
The repeater tax is triggered if a team is in the Luxury Tax for 3 of the last 4 years. It can get expensive. Similar to the standard Luxury Tax table above, the below table shows the amounts you pay per $1 if you are in the repeater tax.
| NBA Repeater Tax Payments | |||
| $s over Threshold | Amount per $ | Increment Max | Cumulative $s |
| $0-5million | $2.50 | $12,500,000 | $12,500,000 |
| $5-10million | $2.75 | $13,750,000 | $26,250,000 |
| $10-15million | $3.50 | $17,500,000 | $43,750,000 |
| $15-20million | $4.25 | $21,250,000 | $65,000,000 |
| $20-25million* | $4.75 | $23,750,000 | $88,750,000 |
| $25-30million | $5.25 | $26,250,000 | $115,000,000 |
| $30-35million | $5.75 | $28,750,000 | $143,750,000 |
| $35-40million | $6.25 | $31,250,000 | $175,000,000 |
| *After $25m it increase 50c for every additional $5m over | |||
So how did the Warriors $6.5million higher wage bill than the Nets translate into a $72.5 million higher tax bill? The answer is the repeater tax.
When a GM is looking to sign a player to a new contract, whether through free agency, extending a current player or acquiring a player through trades – they MUST factor in the projected salary cap, potential luxury tax and especially the repeater tax bill.
Next time your team makes a trade you don’t understand, maybe losing a fan favorite who’s always put the work in and instead signing someone similar with slightly lesser on court ability who the fans don’t know. It could have just saved the owner $60 million in tax fee’s, or created flexibility for the GM to sign a key cog in the machine later in the season.
Yes, I know, NBA owners are RICH. Beyond rich really. Joe Lacob, the Warriors owner, is clearly not afraid to spend money to keep a team he believes in together. With Curry & Co’s 4th title in 7 years, it’s hard to argue he’s wrong.
If you look at the Warriors roster you’ll see that the majority of their wage bill goes to players they drafted. Steph Curry, Klay Thompson & Draymond Green the obvious names. This in a way, makes it easier to spend the money. (This is all about Bird Rights – something we will be sure to cover in a later article).
The NBA is set up to allow teams to improve through drafting good players, developing them, paying them and winning with them. However, if a team is very active in the trade and free agent market, the league has rules that can stop even the richest owner from buying success. This is called “The Hard Cap”.
How can an NBA team get Hard Capped?
As we said earlier the NBA has a soft salary cap. But it also, in certain situations, operates a hard cap. There are three ways a team can trigger the hard cap, once triggered the hard cap lasts for that season.
- The team uses its bi-annual exception to sign a player.
- The team uses more than the taxpayer portion of the mid-level exception to sign a player (or multiple players).
- The team acquires a player via sign-and-trade.
A team making any of the above roster moves must ensure that its team salary is below the “tax apron” when it finalizes the transaction and stays there for the remainder of the season. The league will void any transaction that threatens this.
Lot’s of new terms there, let’s go 1 by 1;
Tax Apron – Effectively the Hard Salary Cap Figure. Calculated by using the luxury tax threshold and adding around $6million. For 2021-22 the threshold was $136,606,000 and the Tax Apron for Hard Capped teams was $143,002,000.
Mid Level Exception – Is a Salary Cap Exception that allows the signing of one or multiple free agents to contracts above the minimum salary, even if they are above the cap.
Bi Annual Exception – Allows teams to sign a player who falls above the minimum salary and below than the mid-level. The bi-annual exception can only be used every other season.
Sign & Trade – Occurs when a player is out of contract and wants to leave. They may agree to sign him to a new contract and trade him to a predetermined team. This allows the player to possibly get a more valuable contract, the team he is departing to get something back and the team he is going to the ability to acquire a “Free Agent” even if they don’t have cap space.
If a franchise can successfully avoid the hard cap and doesn’t mind going deep into their owners cash reserves it is possible to spend an almost unlimited amount of money on an NBA roster. However, the timings, rules and in many cases the sheer cost make this a fairly non-viable option.
The Warriors hit the perfect storm in the summer of 2016. They had just blown a 3-1 lead in the NBA Finals, having come back from a 3-1 deficit against Durrants Thunder team in the conference Finals. They wanted to upgrade, he wanted a new home. At the same time the Salary cap spiked, giving teams huge amounts of Cap Space. Anyone remember this guy?
Free agent Ian Mahinmi has agreed to a four year, $64M deal with Washington, league source tells The Vertical.
— Shams Charania (@ShamsCharania) July 3, 2016
Finally, reigning MVP Steph Curry was still on a very team friendly contract due to ankle issues that plagued him early in his career.
All this allowed the Warriors to sign Kevin Durant in free agency (he actually left some money on the table as well).
Two dominant titles and 1 injury plagued Finals later, Durant decided to move on again. A sign and trade with Brooklyn that allowed the Warriors to take back DeAngelo Russels contract, which would later be turned into Andrew Wiggins has allowed the Warriors to emerge from injury in 2022 with a team capable of winning the NBA title.
| Warriors 2021-22 Salary | |
| Player | Salary |
| Steph Curry | $48,070,014 |
| Klay Thompson | $40,600,080 |
| Andrew Wiggins | $33,616,770 |
| Draymond Green | $25,806,469 |
| Total | $148,093,333 |
We’ve already covered how much the Warriors roster cost last season.
Warriors salary on the books for 2022-23 is $209,273,363.
With the 2022-23 Salary Cap expected to be around $122 million and with Kevon Looney and Jordan Poole expected to be extended, the Warriors are set to be facing an astronomical luxury Tax Bill for the coming season. In total the 2022-23 Golden State Warriors roster may cost Joe Lacob upwards of $500 million. That really would be the most expensive roster in NBA History by quite some distance, light years ahead of anyone else.