Dodgers Part of Combined MLB Record in Luxury Tax Payments for 2025

Jul 30, 2025; Cincinnati, Ohio, USA; A general view of a Los Angeles Dodgers hat and glove during the second inning in the game against the Cincinnati Reds at Great American Ball Park. Mandatory Credit: Katie Stratman-Imagn Images | Katie Stratman-Imagn Images

The Los Angeles Dodgers winning a second consecutive World Series came at a significant financial cost as they fielded the most expensive roster in MLB history with a $417.3 million payroll.

That total went well past the 2025 MLB luxury tax threshold of $241 million. It marked a fifth consecutive season the Dodgers' payroll exceeded the luxury tax, and thus they incurred additional surcharges.

According to Ronald Blum of the Associated Press, the Dodgers' luxury tax bill for the 2025 season came in at $169.4 million. Coupled with their 2024 total, the Dodgers have faced $272.4 million in luxury tax penalties while winning back-to-back championships.

For the 2025 season, the New York Mets, New York Yankees, Philadelphia Phillies, Toronto Blue Jays, San Diego Padres, Boston Red Sox, Houston Astros and Texas Rangers also exceeded the luxury tax threshold.

Per Blum, the Mets had the second-highest bill at $91.6 million, followed by the Yankees at $61.8 million. The Phillies were a distant fourth with a luxury tax penalty of $56.1 million, and there was even more of a drop off to the Blue Jays, Padres, Red Sox, Astros and Rangers, respectively.

Penalties were particularly costly for the Astros, Mets and Rangers, as they each missed the postseason. That was especially disappointing and inexcusable in the Mets' case.

MLB calculates payroll tax by taking the average annual values of contracts, including performance bonuses, for players on 40-man rosters. Also factored in is just north of $17 million per team for player benefits, and another $1.67 million that contributes to the $50 million pool for pre-arbitration players.

Teams must make their luxury tax payments to MLB by Wednesday, Jan. 21.

Dodgers Contribute to MLB Record in Luxury Tax Money for 2025

Nine teams exceeding the luxury tax last season tied an MLB record that was first set in 2024. But last year's group has the distinction of setting a new record by combining for a total of $402.6 million in luxury tax money.

The previous high was $311.3 million during the 2024 season.

Because the Dodgers exceeded the luxury tax threshold for a third year in a row, they faced a 50% rate on the first $20 million above the $241 million threshold, 62% rate on the additional $20 million spent, 95% surcharge from $281 million to $301 million, and a 110% rate for payroll above that.

Last season was the 10th time the Dodgers have gone over the luxury tax threshold since the Guggenheim Baseball Management Group purchased the team from Frank McCourt in 2012.

The last time the Dodgers were below the luxury tax threshold was in 2020, with a payroll of roughly $204 million. It was the end of a streak in which the organization did not make any luxury tax payments for three years in a row.