NBA salary cap
The NBA salary cap is the limit to the total amount of money that National Basketball Association teams are allowed to pay their players. Like many professional sports leagues, the NBA has a salary cap to control costs, defined by the league's collective bargaining agreement (CBA). This limit is subject to a complex system of rules and exceptions and as such is considered a "soft" cap.
The actual amount of the salary cap varies from year to year, and is calculated as a percentage of the league's revenue from the previous season; for instance, the cap for the 2007–08 season was approximately US $55.6 million per team, and in 2008–09 it was $58.68 million. Under the CBA ratified in December 2011, the cap will continue to vary in future seasons based on league revenues; for the 2014–15 season, the salary cap was $63.065 million and the luxury tax limit was $76.8 million.
History
The NBA had a salary cap in the mid-1940s, but it was abolished after only one season. The league continued to operate without such a cap until 1984–85, when one was instituted in an attempt to level the playing field among all of the NBA's teams and ensure competitive balance for the League in the future. Before the cap was reinstated, teams could spend whatever amount of money they wanted on players, but in the first season under the new cap, they were each limited to $3.6 million in total payroll.
