Welcome to New York and Yankee pinstripes, Masahiro Tanaka.
And get ready to pay up the wazoo.
Tanaka is the Japanese pitcher the Yankees signed this week to a seven-year, $155 million contract. And guess what? Taxes will claim more than half of it.
Americans for Tax Reform did a back-of- the-envelope calculation of Tanaka’s tax burden. They reckon that over the seven years of his contract, his decision to play for the Yanks will mean a combined marginal tax rate of 56.1 percent in federal, state, city and Medicare payroll taxes.
Tanaka’s other two choices were the Cubs and Diamondbacks. Because of lower state rates in Illinois and Arizona, and the lack of a city income tax in either Chicago or Phoenix, the ATR says Tanaka would have saved nearly $12 million if he’d signed with the Cubs and $13 million if he’d gone with the Diamondbacks.
More than 10 years ago, Mayor Michael Bloomberg famously dismissed the idea that the high cost of doing business in New York was a problem: “If New York City is a business,” he said, “it isn’t Wal-Mart — it isn’t trying to be the lowest-priced product in the market. It’s a high-end product, maybe even a luxury product.”
Maybe if, like Tanaka, your dream is to pitch the winning game at Yankee Stadium in the World Series, you’re willing to pay that premium — especially when you still get to keep the remaining $68 million.
But not everyone is willing to make that tradeoff. When the Mariners lured Yankee second baseman Robinson Cano to Seattle recently, The Post noted he would save $42 million, because Washington state has no income tax.
The more pertinent point, of course, is that most of those who are making tax-tradeoff decisions are not star athletes. They are business people who have to decide what’s best for their bottom line.
And when high taxes and high spending make New York a “luxury product,” more people are bound to conclude they can’t afford it.