The NBA salary cap will be $154.6 million for the 2025-26 season, the league announced on Monday, ahead of the official start to free agency at 6 p.m. ET. The figure, which matches the NBA-issued guidance to teams in March, marks a 10% increase from last season.
The salary cap is based on projected basketball-related income (BRI), and 10% is the maximum allowable increase. The 10% bump was inevitable after the league signed its new 11-year, $77 billion media agreements with NBC, ESPN/ABC and Amazon in July. It boosts the annual payout to teams by 33% to $137 million in the first year, according to three NBA team executives.
The 2024-25 cap of $140.6 million was up 3.4% following back-to-back years with max 10% increases.
The luxury tax for the 2025-26 season is $187.9 million, with the first “apron” at $195.9 million and the second apron at $207.8 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 minimum team salary for the 2025-26 season is $139.1 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 20 non-tax teams during the 2024-25 season are expected to each receive a payout of roughly $11.5 million from tax proceeds.
The biggest taxpayer from the 2024-25 season was the Phoenix Suns at an estimated $152 million, according to Sportrac. They were followed by the Minnesota Timberwolves ($90 million), Los Angeles Lakers ($53.5 million) and Boston Celtics ($53 million).
The NBA added the 10% cap in the 2023 CBA to avoid one-time salary-cap spikes, such as the one that allowed the Golden State Warriors to sign Kevin Durant as a free agent in 2016 when the cap jumped 34.5% to $94.1 million. You can probably pencil in 10% increases to the cap and rookie contracts through the end of the CBA after the 2029-30 season, with the media deal in place at hefty annual increases. It would mean a $226 million cap for that season.
The 2025 free agency class is light on star power, and few teams have much room under the salary cap, but the cap is used for star players who are eligible for max salaries. This summer, NBA MVP Shai Gilgeous-Alexander is eligible to sign a supermax deal worth $293 million over four years. It would kick in for the 2027-28 season at 35% of the cap and a projected $65.5 million in Year 1.
Rookie contracts for first-round picks, which are also tied to the NBA salary cap per the CBA, are up 10% for the 2025-26 season. Cooper Flagg, the No. 1 pick in the 2025 NBA Draft, is set to earn $62.7 million over four years, with Year 1 worth $13.8 million.