With escrow flattening and NHL revenues booming, the Leafs are finally able to flex their financial muscle again
While many teams have no issue handing out massive signing bonuses to superstars, most of the league is hesitant to hand out those bonuses to role players. That's where the Leafs separate themselves and make what look like "bad contracts" manageable and moveable.
The Leafs have built a reputation for handing out all sorts of signing bonuses, and front loading contracts. They did so with the likes of Kasperi Kapenen, Andreas Johnsson and even Nazem Kadri. All of which were traded shortly after the Leafs paid bonus. More recently, they did it with Calle Jarnkrok who signed a 4-year, $8.4M deal. Of Jarnkrok's $8.4M, just over $5.3M will be paid in signing bonuses, making his contract easily movable if things don't work out the way the Leafs have planned.
In 2019, after signing Kapenen and Johnsson, Dubas talked about the ability the Leafs have of handing out all the bonuses they do saying, "We get the taxation used against us a lot, if you play elsewhere you play in a lower tax bracket. Other teams use that, so we're fortunate here because of our fan base, because of our coverage and because of our corporate structure partners. For us, to have the taxation argument used against us but not use any of the advantages we have would be foolish on our part.»
As Dubas had stated, as much as teams like Tampa, Florida, Vegas and Nashville lure players with no state income tax, the Leafs use their ability structure contracts in ways most teams can't to supplement taxes. Those types of contract structures also allow the Leafs to move or take on what others deem "bad contracts" because they are willing to pay the bonuses.
With player escrow levelling out, and the players almost having paid back the league, as well as NHL revenues soaring, the Leafs are able to flex their financial muscle again and offer bonus-heavy contracts to lure players away from what could be a better contract somewhere else.
