Indiana Pacers v Oklahoma City Thunder
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Pacers vs. Thunder: The First Luxury Tax Free NBA Finals
The 2025 NBA Finals between the Oklahoma City Thunder and Indiana Pacers has already secured a place in history books—not just for the thrilling matchup, but for a unique financial feat.
For the first time since the NBA implemented its luxury tax system in 2002, the Finals feature two teams that stayed completely below the luxury tax threshold.
This is a testament to the savvy strategies employed by small-market franchises that thrived through smart roster construction and financial discipline.
The luxury tax, set at $170.8 million for the 2024-25 season, penalizes teams that exceed this payroll limit, often reflecting an aggressive spending spree to secure elite talent.
Unlike their opponents on the road to the Finals, such as the New York Knicks and Minnesota Timberwolves with payrolls of $188.8 million and $202.7 million respectively, the Pacers and Thunder managed to build competitive rosters without plunging into this financial territory.
The Pacers ranked 18th in payroll this season with $169.1 million, while the Thunder sat even lower at 25th with $165.6 million.
Their collective avoidance of expensive contracts and reliance on young, high-performing players with manageable salaries has set the stage for a cost-effective championship clash.
RELATED | Understanding The NBA Luxury Tax And Its Potential Impact On The Pacers
The Thunder have long been a model of strategic rebuilding, driven by their blockbuster trade of Paul George in 2019.
That deal brought them Shai Gilgeous-Alexander and a treasure trove of draft picks, enabling Oklahoma City to amass a deep collection of young talent on rookie-scale contracts.
Gilgeous-Alexander, now an MVP and the Thunder’s highest-paid player, is on a $35 million annual salary.
Joining him are key contributors like Jalen Williams and Chet Holmgren, still on rookie deals, and reasonably priced veterans like Lu Dort ($16.5 million) and Isaiah Hartenstein ($29 million over three years).
These contracts allowed OKC to develop a dynamic roster without breaking the bank.
Similar disciplined management has fueled the Pacers’ return to NBA prominence.
By trading Paul George for Victor Oladipo and Domantas Sabonis in 2017, then later flipping Sabonis for Tyrese Haliburton in 2022, Indiana focused on acquiring a mix of rising stars and valuable cap space.
Haliburton ($42.1 million) and Pascal Siakam, another marquee Pacer with the same salary, are the financial anchors of the team.
Meanwhile, Myles Turner ($19.9 million) and a collection of younger players like Andrew Nembhard and Aaron Nesmith round out a high-performing roster without excessive spending.
It’s no coincidence that both teams hail from smaller NBA markets.
While both teams are celebrating their financial discipline, tougher decisions are on the horizon.
Many of their young stars are likely to command significant contract extensions soon, potentially pushing payrolls into luxury-tax territory.
Shai Gilgeous-Alexander’s eligibility for a supermax extension and the rookie-scaled Chet Holmgren’s rise could make keeping this low-cost formula a challenge for OKC. Meanwhile, Myles Turner’s upcoming free agency likely means a big raise for Indiana’s star center.
RELATED | Is Myles Turner the key to the Indiana Pacers success?
The Pacers and Thunder have not only redefined small-market excellence but also reminded the league that championship aspirations don’t always come with a luxury tax bill attached.
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