Major League Baseball has finalized its calculations of the team’s competitive balance tax for the 2025 season. As first reported by the Associated Press, nine teams exceeded the $241MM base cap. In a separate post, AP lists the completed CBT numbers for all 30 groups.
The fees are as follows:
- Dodgers: $169.4MM
- Meter: $91.6MM
- Yankees: $61.8MM
- Phillies: $56.1MM
- Blue Jays: $13.6MM
- Tickets: $7MM
- Astros: $1.5MM
- Red Sox: $1.5MM
- Guards: $190K
Teams pay increasing fines for exceeding the limit in consecutive seasons. The Dodgers, Mets, Yankees, Phillies and Rangers have all paid the tax in at least three straight years – putting them on the highest escalator costs. The Astros crossed the line for the second straight season. The Blue Jays, Padres and Red Sox received the following in 2024 and were classified as first payers.
This is the second year in a row that nine teams have paid for CBT. The Braves, Giants and Cubs had crossed the line in ’24 but dipped below this year, resetting their status to 2026. Atlanta’s active offseason puts them in position to return to the tax bracket next year, when the base cap rises to $244MM. San Francisco and Chicago each posted CBT numbers more than $40MM below that currently.
Although public estimates from RosterResource and Cot’s Baseball contracts provide a good estimate of teams’ salary obligations, official numbers are not available during the season. It is not uncommon for rounding errors in those calculations to differ by several million dollars. That’s usually not a big deal but it can be important for teams that move very close to the tax line. Each of the Red Sox ($249MM payroll), Astros ($246MM) and Rangers ($241.38MM) are believed to be slightly over the $241MM cutoff, but that wasn’t 100% established until tonight – especially in the case of Texas.
The Dodgers ($417MM), Mets ($347MM), Yankees ($320MM), Phillies ($314MM) and Blue Jays ($286MM) all had payrolls over $281MM. That was the third phase of the penalty and marked the point at which the team’s draft pick was dropped 10 spots. The Mets are the only one of the five that didn’t make the playoffs. Their top pick drops from 17th to 27th. The Yankees, Philadelphia, Toronto and LA all had their first round picks fall between 35 and 40.
Teams that have paid CBT are entitled to a lower level of compensation for the loss of free agents who reject qualifying offers. They get a draft pick after the fourth round for each departing free agent. They were charged a hefty fine — their second and fifth top picks in 2026 and $1MM in their ’27 international bonus — for signing an eligible free agent from another team.
San Diego and the Mets got a pick after the fourth round with the loss Dylan Cease again Edwin Díazrespectively. Toronto (Bo BichetteHouston (Framber Valdezand Philadelphia (Guard Suárez) will get the same if their free agents sign elsewhere. The Dodgers surrendered their second and fifth round picks to Díaz. Toronto is slated to do the same for Cease, but if Bichette leaves, they could give up that compensatory pick instead and send a fifth-rounder back.
The Dodgers’ combined payroll and tax bill for the 2025 season sits north of $586MM. The two-time defending champions’ tax alone is more than the salary of the bottom 12 teams in the league. There were 14 clubs that had a CBT number over $200MM. The Braves, Cubs, Giants, Angels, Diamondbacks and Mariners are the other six teams above the median. All but Seattle spent more than $200MM.
On the other hand, the Marlins ($87MM) and White Sox ($92MM) were the only two teams with payrolls below $100MM. The Rays ($103MM), Pirates ($109MM) and Athletics ($118MM) completed the bottom five – followed by the Rangers, Nationals, Twins, Brewers and Reds.
In total, the league will collect less than $403MM in taxes. Teams must make payments by January 21. The first $3.5MM will be used to fund player benefits. Part of the remaining money goes to the players’ retirement accounts, and the other part is used to distribute revenue from MLB to the teams.
