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How Washington's 'millionaires tax' could impact the Sonics' return
As the NBA gets closer to a major expansion decision, there are lingering concerns about whether Washington's tax climate could factor into a Sonics comeback.
SEATTLE - As the NBA inches closer to a possible expansion decision, questions are emerging in Washington state about whether the region’s tax climate could influence the league’s thinking on a potential return of the Seattle SuperSonics.
State Republican Party Chair Rep. Jim Walsh said concerns about taxes were raised during a recent meeting between Gov. Bob Ferguson and NBA Commissioner Adam Silver.
"It might be something that would interfere with a return of the Sonics to Seattle," said Walsh. "I don’t think it’s like a dead deal or anything, but Silver, the head of the NBA, had concerns."
While the proposed tax changes would not take effect for two more years, Walsh suggested the broader tax environment could still factor into long-term decisions by the league and team owners.
Local voices weigh potential impact
What they're saying:
Outside the political sphere, Seattle sports historian Dave Eskenazi said taxes could play a meaningful role in decision-making — particularly at higher income levels.
"I think it could. I think it absolutely could," Eskenazi said. "You know 10% on large amounts of money is a lot of money, any way you slice it. It’s not like it’s 1.5% or 2%, so that’s not insignificant no matter how much wealth has been accumulated."
Eskenazi described the potential tax burden in this context as a negative factor.
Data suggests taxes are only part of the picture
By the numbers:
Ellis Simani, a Seattle-raised data journalist with ProPublica, said taxes do influence decisions by athletes and owners but emphasized they are just one piece of a broader equation.
Simiani has analyzed tax records of high-profile figures including LeBron James and Los Angeles Clippers owner Steve Ballmer to better understand how the system affects different earners.
"I think taxes are really something to help us understand the different things at play that we don’t really comprehend," said Simani.
His reporting found stark differences in effective tax rates. In one analysis of 2018 federal returns, a stadium worker paid about 14% in federal taxes, while Ballmer — who earned more than $650 million — paid about 12%. LeBron James, who earned more than $100 million, paid about 37%.
Simiani noted that tax structures can favor wealthy owners through deductions tied to business purchases, such as acquiring a professional sports franchise.
Still, he cautioned against overstating the role taxes play in team or player decisions.
"You have big name athletes going to markets like California and New York where they do have income taxes," he pointed out. "There’s other ways in which athletes earn money, through things like brand deals or endorsements, and sometimes those can be really location and market dependent as well."
He said taxes may be getting extra attention amid current political debate, but emphasized they are only one part of a larger picture.
"I can only imagine the income tax piece is only one of several things that folks are considering," he added.
Talks ongoing
What's next:
Despite the concerns, discussions between state leaders and the NBA are continuing. Ferguson and Silver are expected to meet again Monday as conversations over a potential return of the SuperSonics remain active.
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The Source: Information in this story comes from original reporting by FOX 13 Seattle reporter Lauren Donovan, as well as supplemental data from ProPublica data journalist Ellis Simiani.