Tabascocat
Dexternjack
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Where does this classification come from. No one in baseball says anything about a cap...because there isnt one. The nfl has a hard cap, the nba has a soft cap and luxury tax, the mlb has only a luxury tax.
You are correct, technically there isn't a cap at all because teams can pay players whatever they want......they just pay a luxury tax on certain contracts.
A soft cap represents an amount which may be exceeded in limited circumstances, but otherwise exceeding the cap will trigger a penalty which is known in advance. Typically these penalties are financial in nature; fines or a luxury tax are common penalties used by leagues