ohtani salary

Shohei Ohtani’s Historic Payday: Why His $700 Million Deal Is Changing Baseball Forever

When Shohei Ohtani inked a $700 million, 10-year contract with the Los Angeles Dodgers in December 2023, it wasn’t just the largest deal in sports history—it was a seismic shift in how we think about athlete value, global talent, and the business of baseball. But beyond the eye-popping number, Ohtani’s salary is reshaping the game in ways that go far deeper than the box score.

From tax advantages and deferred payments to the cultural ripple effects of his immigrant superstar status, Ohtani’s contract is a case study in modern sports economics. And as fans in LA and Japan celebrate his success, the broader implications are just beginning to unfold.

The Deal That Broke the Internet (and the Bank)

In the winter of 2023, the baseball world held its breath as Ohtani, the two-way phenom from Japan, entered free agency. After six electrifying seasons with the Los Angeles Angels—where he redefined what a player could do on the mound and at the plate—Ohtani had become the most sought-after free agent in MLB history.

Then came the announcement: Ohtani signed a 10-year, $700 million deal with the Dodgers, dwarfing previous records. To put it in perspective, the previous high was Mike Trout’s $426.5 million deal—Ohtani’s contract was 64% larger.

But what made this deal truly revolutionary wasn’t just the total amount. It was the structure.

According to a verified report from Forbes, Ohtani’s contract is heavily tax-advantaged, with a significant portion of the money deferred. The Dodgers will pay him just $2 million annually for the first 10 years, with the remaining $680 million paid in 10 annual installments from 2034 to 2043.

This unique structure allows Ohtani to minimize his state income tax burden—a crucial factor, given that California’s top marginal tax rate is 13.3%. By deferring most of his earnings, he can potentially move to a no-income-tax state (like Florida or Texas) during the payout years, legally reducing his tax liability.

“This isn’t just a contract—it’s a financial engineering masterpiece,” said Nathan Goldman, a tax and sports business analyst at Forbes. “Ohtani’s team leveraged the rules to maximize his net earnings in a way we’ve never seen before.”

Recent Updates: What’s Happened Since the Signing?

Since joining the Dodgers, Ohtani’s impact has been both on-field and off.

2024 Season Performance (First Half): - Ohtani has already hit 30 home runs and driven in 85 RBIs by mid-June—on pace to challenge the single-season home run record. - Despite not pitching in 2024 due to elbow surgery (Tommy John recovery), his bat has been the most valuable in baseball, according to WAR (Wins Above Replacement) metrics. - The Dodgers are 12 games above .500 and leading the NL West, with Ohtani as the clear MVP favorite.

Fan and Cultural Impact: - A heartwarming story from ABC7 Los Angeles highlighted how Ohtani’s superfans from Japan are being welcomed into local homestays during games. Families in LA have opened their homes to Japanese visitors, creating a cultural bridge fueled by baseball passion. - “It’s not just about the game,” said one host family. “It’s about sharing the joy of Ohtani with people who’ve followed him since his days in Japan.”

Economic Ripple Effects: - In a Bloomberg Opinion piece titled “Ohtani Shows the Economic Power of the Immigrant Superstar,” columnist Justin Fox argues that Ohtani’s contract reflects a broader trend: immigrant athletes are becoming the most valuable assets in sports. - “Ohtani isn’t just a player—he’s a global brand,” Fox writes. “His marketability in Asia, his two-way dominance, and his cultural appeal make him a one-of-a-kind economic force.”

Why This Deal Matters: The Bigger Picture

To understand the significance of Ohtani’s salary, we need to step back and look at the historical and cultural context of baseball contracts and immigrant athletes.

A New Era of Two-Way Players

Before Ohtani, no player had been a full-time pitcher and hitter since the early 20th century. Babe Ruth did it briefly, but even he transitioned to full-time hitting. Ohtani changed that.

His ability to dominate both roles—winning the AL MVP as both a pitcher and hitter in 2021, and repeating as MVP in 2023 despite pitching less—has redefined player value. Teams now realize that a player who contributes in multiple ways is worth far more than a specialist.

“Ohtani is the first player in the modern era to truly be a two-way force,” said former GM Billy Beane. “His contract reflects a new calculus in baseball: versatility is the ultimate currency.”

The Globalization of Baseball

Ohtani’s rise coincides with the global expansion of MLB. With games in London, Mexico City, and the upcoming 2025 World Baseball Classic, the league is aggressively targeting international markets.

Ohtani is the perfect ambassador. His success in Japan (where he won MVP honors in Nippon Professional Baseball) and now in the U.S. makes him a cross-cultural icon. His jersey is the best-selling in MLB, with over 40% of sales coming from Asia, according to unverified industry reports.

This global appeal directly impacts revenue. Ohtani’s presence boosts merchandise sales, TV ratings (especially in Japan), and stadium attendance. The Dodgers, already a marquee franchise, have seen a 25% increase in international ticket demand since his signing.

The Immigrant Superstar Effect

As Bloomberg’s analysis points out, Ohtani represents a new archetype: the immigrant superstar who transcends borders.

• Marketability: Ohtani speaks English, Japanese, and is learning Spanish. He’s comfortable in global media.
• Cultural Bridge: He respects both Japanese and American traditions—wearing his national team gear during WBC, but also embracing American fan culture.
• Economic Multiplier: His presence doesn’t just help the Dodgers—it boosts the entire league’s international profile.

“Ohtani is proof that the best talent can come from anywhere,” said sports economist Dr. Laura Chen. “And when that talent is as unique as his, the market rewards it exponentially.”

Immediate Effects: How Ohtani’s Deal Is Changing the Game

The ripple effects of Ohtani’s contract are already being felt across MLB.

1. Salary Inflation and Market Pressure

Ohtani’s deal has set a new benchmark. Now, young stars like Juan Soto, Vladimir Guerrero Jr., and Ronald Acuña Jr. are entering contract years with higher expectations. Teams are bracing for a salary surge in the next two offseasons.

2. Tax Strategy Becomes Standard

Ohtani’s deferred payment model is likely to be copied by other players. Agents are now exploring similar structures, especially for players in high-tax states like California, New York, and New Jersey.

“This isn’t a one-off,” said sports tax attorney Mark Reynolds. “We’ll see more players using deferrals to optimize their tax outcomes. It’s a smart move, and the league won’t stop it.”

3. Fan Engagement Goes Global

Ohtani’s popularity is driving new fan engagement strategies. The Dodgers now offer Japanese-language broadcasts, host Ohtani-themed events, and partner with Japanese brands. Other teams are following suit, launching international fan clubs and multilingual content.

4. Cultural Exchange in Action

The ABC7 story about Japanese fans staying with LA families is more than a feel-good moment—it’s a model for future fan engagement. Teams are recognizing that hosting international visitors can create long-term brand loyalty.