The NBA set its salary cap at $140.588 million for the 2024-25 season, the league announced on Sunday. It is a slight decrease from the January update of $141 million. The cap went into effect at 12:01 a.m. ET Monday. Teams were allowed to negotiate with free agents outside of the ones on their own teams at 6 p.m. Sunday.
The cap is based on projected basketball-related income for the upcoming season. The 2024-25 cap is up 3.4% over the $136 million figure for the 2023-24 season. It follows back-to-back years with 10% increases, which is the most the cap can increase under the terms of the collective bargaining agreement.
Next season will likely be the last one for the foreseeable future without a 10% increase to the cap, with the league on the verge of signing a TV deal worth at least $75 billion and more than a 150% increase on the previous annual average. It would mean a cap of $206 million for the 2028-29 season.
The minimum team salary for the season is $126.5 million, which represents 90% of the salary cap. If a team fails to reach the minimum payroll, it must pay the league the difference. Teams that don’t hit the minimum are also prohibited from receiving a share of luxury tax payments that the NBA distributes to non-taxpaying teams. The NBA typically distributes 50% of luxury tax receipts to the teams that stay below the tax threshold, which is $12 million per team for 2023-24, based on estimates from ESPN’s Bobby Marks.
The tax level for the 2024-25 season is $170.8 million, with the first “apron” at $178.1 million and the second apron at $188.9 million. The two aprons are non-financial penalties that hinder roster-building, with the second apron added during the 2023 CBA and including more punitive restrictions.
The biggest luxury tax bills for the 2023-24 season are for the Golden State Warriors ($177 million), Los Angeles Clippers ($142 million), Phoenix Suns ($68 million), Milwaukee Bucks ($53 million) and Boston Celtics ($44 million), per Marks’ estimates. The Denver Nuggets, Miami Heat, and Los Angeles Lakers were other taxpayers.
The final cap figure means that rookie contracts for first-round picks in the NBA Draft will also be up 3.4% versus the previous year’s class, as the rookie scale is tied to the cap. Zaccharie Risacher, who was selected first overall by the Atlanta Hawks, should sign a four-year deal worth $57 million.
The NBA cap will be up only a nominal amount, but its long-term growth dwarfs its fellow U.S. sports leagues and salary cap in other sports. The NBA salary cap was $63 million for the 2014-15 season, nearly 10% lower than the NHL’s cap that year of $69 million. But once the NBA’s $24 billion TV deal kicked in, the league’s cap soared. The NBA cap is up 123% from the 2014-15 season, while the NHL gain is 28% over the same period. The increase for the NFL cap is 92%.
(The first paragraph was updated to correct the time the salary cap went into effect.)
