California State Controller Asks Congress To Take Action Following Shohei Ohtani’s Contract With Dodgers

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The Los Angeles Dodgers created shockwaves throughout baseball when they signed Shohei Ohtani to a record contract worth $700 million over 10 seasons.

As part of the deal, Ohtani agreed to defer $680 million of his salary, taking just $2 million per season over the length of his contract. Following his 10 seasons with the Dodgers, Ohtani will be paid $68 million annually for the ensuing 10 years.

The decision to defer money helped the Dodgers continue to add talent as they also gave contracts to Yoshinobu Yamamoto, Tyler Glasnow, Joe Kelly, Jason Heyward, and reportedly Teoscar Hernández.

The contract terms drew some anger from fans across the league, and the state of California also took issue with the deal.

California State Controller Malia M. Cohen released a statement on the contract noting the deferred money could allow Ohtani to move back to Japan after his playing career and not pay taxes to the state on $680 million of the money. She also asked Congress to step in and take action to close the loophole.

“The current tax system allows for unlimited deferrals for those fortunate enough to be in the highest tax brackets, creating a significant imbalance in the tax structure.” Cohen said.

“The absence of reasonable caps on deferral for the wealthiest individuals exacerbates income inequality and hinders the fair distribution of taxes. I would urge Congress to take immediate and decisive action to rectify this imbalance.

“Introducing limits on deductions and exemptions for high-income earners promotes social responsibility and contributes to a tax system that is just and beneficial for all. This action would not only create a more equitable tax system, but also generate additional revenue that can be directed towards addressing pressing important social issues and fostering economic stability.”

As the chief fiscal officer of California, Cohen is responsible for accountability and disbursement of the state’s financial resources. The Controller has independent auditing authority over government agencies that spend state funds.

She is a member of numerous financing authorities, and fiscal and financial oversight entities including the Franchise Tax Board. Cohen also serves on the boards for the nation’s two largest public pension funds.

Cohen, who was born and raised, and currently resides in San Francisco, was elected in November 2022, following her service on the California State Board of Equalization. California state controllers serve four years after being elected.

Cohen, a San Francisco Giants fan, also told Mike Hagerty of CapRadio that not much can be done about Ohtani’s contract, but her stance is more about addressing issues with inequality moving forward.

Shohei Ohtani and Dodgers donate to Japan earthquake relief

Guggenheim Baseball, the Dodgers and Ohtani came together in supporting the relief efforts after the Sea of Japan earthquake (7.6 magnitude) struck on January 1.

“In collaboration with Shohei Ohtani, who is making his own personal contribution, the Los Angeles Dodgers and Guggenheim Baseball are donating $1 million to support those affected by the New Year’s earthquake in Japan. Our thoughts are with all of Japan in the wake of this tragedy,” the Dodgers said in a statement.

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