The Oklahoma City Thunder took a calculated risk Monday by dealing away a protected first-round pick to the Cleveland Cavaliers for Dion Waiters as part of a three-team trade that also featured the New York Knicks. Waiters is a talented player, but he struggled to find his niche in Cleveland and there are questions about how he'll fit alongside Kevin Durant and Russell Westbrook in Oklahoma City.
Will the Thunder finally pay the luxury tax?
The Thunder are set to pay the luxury tax for the first time ever after trading for Dion Waiters, but there are ways they can get back under the tax line.
Mark D. Smith-USA TODAY Sports
Beyond the on-court risk, the trade for Waiters is significant for another reason: it has the Thunder in line to pay the luxury tax for the first time ever. Oklahoma City is just one of five teams to have never paid the tax, according to Mark Deeks of ShamSports.com. The anti-tax stance came to a head after dealing away James Harden instead of ponying up a max contract for him.
While the Thunder may be on track to pay the tax for now, that doesn’t mean it’s actually going to happen. Tax calculations aren’t made until the end of the season, so Oklahoma City has time to get under. The Thunder’s payroll currently sits at $79,097,610, according to BasketballInsiders.com. The tax line is at $76,829,000, so that’s a difference of $2,268,610.
There are several options in play to get under the line. Reggie Jackson -- who is set for a big payday as a restricted free agent this summer -- is an obvious trade candidate. Ken Berger of CBS Sports reports that New York will try to snag Jackson, although a lack of assets will hinder that pursuit.
Even if the Thunder were to find a palatable trade for Jackson, dealing his $2,204,369 for nothing but future assets wouldn't be enough to get them under. They could waive Ish Smith and his non-guaranteed contract, yet that would have to be done before Wednesday's league-wide deadline to guarantee contracts.
Jeremy Lamb is another prime candidate to be traded. Lamb -- one of the key pieces of the Harden trade -- has fallen out of the rotation this season and will be kicked further down the depth chart with Waiters on board. Like Jackson, trading Lamb's salary of $2,202,000 alone for nothing wouldn't get the Thunder under the tax, but a combination of moves or a trade package featuring multiple players could do the trick.
There's also the matter of Kendrick Perkins' expiring contract that's worth nearly $10 million. Oklahoma City had the option to amnesty or stretch Perkins in the offseason, but the team didn't do it despite his limited production. The Thunder could try to offload Perkins' bloated contract in order to skirt the tax, but they'd likely have to attach an asset with him for another team to take him on.
There are clearly moves that could be made for the Thunder to get under the tax line, but they shouldn’t make a bad deal just to save a few bucks. This is a team that has a loyal fan base in Oklahoma City, and while the market is small, Grantland’s Zach Lowe reported over the summer that the franchise projected to have the fifth-highest profit in the NBA last season. Ownership can’t cry poor, and considering they have a title contender on their hands, they should consider paying the tax if they can’t find a good deal that gets them under.
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