The Dodgers broke Major League Baseball spending records last year with a combined $515 million in payroll and luxury taxes en route to their second consecutive World Series title, and Los Angeles is expected to set the spending record again in 2026, according to final figures compiled by the commissioner’s office.Los Angeles’ 2025 spending includes a record $345.3 million in payroll expenses and $169.4 million in taxes, for a total of $514.6 million. Despite discounting several contracts for deferred payments, the Dodgers’ total payroll is seven times the $68.7 million payroll of the lowest-spending Miami Marlins and more than the bottom six teams combined. The Dodgers spent last year topping the New York Mets’ all-time high of $430.4 million through 2024, and Los Angeles’ spending total does not include a $6.5 million signing bonus given to pitcher Roki Sasaki in his minor league contract.The Mets and Dodgers spent a combined $948.3 million. The ratio of the top five spenders to the five lowest spenders rose from 3.6 in 2021 to a record 4.7 last year.In 2025, the Dodgers ended the Mets’ three-year run as the highest-paid player, with retired ace Clayton Kershaw receiving a bonus of $8.5 million.Los Angeles’ total revenue would be about $71 million higher if not for seven players using deferred funds that resulted in a discount in their salary calculations. Shohei Ohtani His salary is $28.2 million, as $68 million of his $70 million salary last year doesn’t expire until 2035.The Mets have a payroll of $342.1 million and total after-tax expenses of $433.7 million, ranking second.In the first five seasons after owner Steve Cohen bought the team, the Mets spent $1.44 billion without winning a championship: $1.11 billion in wages and $320 million in taxes.The Mets and Dodgers both surpassed the Mets’ 2024 payroll high of $333.3 million.Los Angeles is projected to lead spending in 2026, with $323.3 million in payroll for its 40 players and $163.7 million in taxes for a total of $487.1 million, according to MLB Opening Day numbers. The Mets opened with a record payroll of $358.4 million, projected taxes of $124.1 million and expenses of $482.5 million.Cleveland’s 40-man payroll is its lowest this year at $75.5 million.Total expenses based on regular payroll increased 3.1% to $5.32 billion last year from $5.16 billion in 2024, and total expenses for the four quarters under current labor contracts increased 31.3% from $4.05 billion in 2021.Those numbers do not include a $50 million annual pre-arbitration bonus pool or benefit allocations starting in 2022 in the collective bargaining agreement, which are included in MLB’s luxury tax payroll.On luxury tax payrolls, eight teams exceed the $244 million tax threshold starting in 2026. The Dodgers ($415.2 million), Mets ($379.2 million) and New York Yankees ($339.6 million) were followed by Toronto ($319.5 million), Philadelphia ($315.2 million), Boston ($263.7 million), San Diego ($260.1 million) and Atlanta ($247.9 million).The Chicago Cubs’ starting salary is less than $25,000, and Detroit’s is less than $2.5 million. Salaries can increase or decrease during the season due to trades and roster changes.The Yankees rank third with $301.5 million in regular payroll in 2025, followed by Philadelphia ($291.9 million), AL champion Toronto ($253.1 million), Houston ($236.4 million) and Texas ($229.9 million).Four of the top five teams by spending made the playoffs, in addition to the Mets, as well as the teams with the ninth, 10th, 12th, 15th, 17th, 22nd, 23rd and 25th salary rankings.The Dodgers have the largest salary increase in 2025, reaching $74.4 million. Other teams seeing big revenue increases in 2025 include Detroit ($61.9 million), Baltimore ($60.2 million to $165.6 million), San Diego ($45.6 million to $217.6 million), Philadelphia ($42.8 million) and Toronto ($34.7 million).Fifteen teams have cut payroll between 2024 and 2025, including the Chicago White Sox ($66.1 million to $87.9 million), St. Louis ($39.3 million to $139.1 million), Miami ($29.4 million to $68.8 million) and San Francisco ($28 million to $182.9 million). The Cardinals further cut payroll to $102.3 million on Opening Day this year, including about $47.4 million involving three players who are no longer with the Cardinals: Nolan Arenado, Sonny Gray and Wilson Contreras.The Yankees cut payroll by $9.4 million between 2024 and 2025, raising it to $302.8 million this year.In 2025, 11 teams exceeded $200 million in revenue, tying the record set in 2023. Five teams have less than $100 million in revenue, one more than the 2024 record low.Last year’s regular payroll was based on 2025 salaries, earned bonuses and prorated signing bonuses and non-cash compensation for 40 players. Deferred wage and bonus payments are discounted to current value, and release clauses, option buyouts and cash transactions between clubs are also taken into account.MLB calculated the average salary as of Aug. 31, the last day before the active roster expanded to 26 players, to be $4,611,595. The players association used a slightly different approach and came up with $4,721,393. The luxury tax is calculated based on the average annual value of the payroll, which includes benefits and the pre-arbitration bonus pool. The players’ association argued the disparity should not be measured in tax dollars because half of the tax money goes to the commissioner’s discretionary fund, which is allocated to teams that qualify for revenue-sharing funds that augment their non-media local revenue.
