SI got its hands on the owners luxury tax proposal. All I can say is… wow!
In a nutshell, it starts at a $1.75-to-1 tax that increases 50 cents every five million you're over the cap. Follow that link for the exact breakdown, which will make more sense when you see it.
The kicker, and the part that essentially makes this a hard cap, is the way the penalty jumps for teams regularly over the threshold
And the poker gets even hotter. As Yahoo! Sports’ Adrian Wojnarowski reported late Monday, the proposal would penalize teams that pay the tax in more than two seasons during any five-season stretch. That penalty is harsh, according to a source familiar with the matter. If a team has gotten into tax territory, say, twice over the preceding four seasons and finds itself over the tax line a third time, each penalty ratio triples. In other words, that $1.75-1 ratio that kicks off the tax in Year 1 would jump to $5.25-to-1 for a team paying the tax a third time. Do the math, and you could get to 10-to-1 or higher pretty quickly, and whether you’re the Lakers or the Knicks or the Bill Gates Billionaires (based in Seattle!), you are going to blink at paying $100 million-plus in tax penalties alone. Fine, maybe Gates wouldn’t blink, but he doesn’t own an NBA team.
A 10-to-1 luxury tax? No wonder the players rejected it. There's no way teams would go that far. This basically enacts a $70 million hard cap. It doesn't sound horrible to have a cap set at $70 million, but it's a back-door way to sneak a hard cap into the deal.