U.S. citizens playing for the Raptors and Grizzlies
have seen an increase in their income taxes, according to
Bill Harris of the TORONTO SUN. Raptors GM Glen Grunwald:
"We believe it equates to a 1%-2% increase. It's not
insignificant amount when you consider what these guys
make." U.S. athletes playing for the Raptors and Grizzlies
are taxed by both Canada and the U.S., based on their
"source income" in each country. In general, Canadian tax
rates "are slightly higher" than the U.S. When the NBA
teams began play in '95, "team accountants were advised by
Revenue Canada to calculate 'Canadian source income' based
on games played," which worked out to about a 51-49 split
between Canadian income. But the teams have since been told
by Revenue Canada that Canadian income should be calculated
by "duty days," or the total number of days players spend in
Canada during the season. This "means about 68% of a
player's income is being taxed at the Canadian rate, with
only 32% at the U.S. rate." Revenue Canada spokesperson
Michel Cleroux: "The IRS does it exactly the same way with
Canadians playing in the U.S." NBPA Exec Dir Billy Hunter:
"This matter could have dramatic consequences on our
players' livelihoods" (Bill Harris, TORONTO SUN, 11/26).
