The Indiana Pacers seemingly don't want to pay the luxury tax and will keep finding ways to dodge it.
Heading into this offseason, there was a big discussion about whether Indiana would be willing to pay the luxury tax to keep their roster together. The Pacers have not been a luxury tax team for two decades, but after an NBA Finals appearance and two conference finals runs, there were reasons for the team to change that mindset. Furthermore, this was something they were going to have to do in order to re-sign Myles Turner in free agency.
Ultimately, the Pacers, for one reason or another, are still not a luxury tax team. Turner departed Indiana to join the Milwaukee Bucks. However, the Pacers were reportedly more than willing to pay the luxury tax to retain their long-time big man (h/t ESPN).
Recently, NBA writer Tim Bontemps acknowledged that Indiana once again is not a luxury tax team. Furthermore, with Tyrese Haliburton on the shelf, it is fair to assume that it will be a long time before they become one once again (h/t The Hoop Collective podcast).
"We talked all spring about--were the Pacers actually going to be willing to pay the luxury tax, something they never do, and for all of the bluster they had about paying the tax, they are not paying the tax. You could say they're not doing it because Tyrese Haliburton is hurt, and that's fine, but their team was built around an ensemble cast, and Myles Turner was a big part of that," Bontemps said.
The Pacers can find success without paying the luxury tax
Regardless of whether it is the right call for the long term or not remains to be seen, but the Pacers have had a lot of success recently despite not paying the luxury tax. They are fresh off their first NBA Finals appearance since 2000, and they made it to back-to-back conference finals in 2024 and 2025. Indiana has proven they don't need to be an expensive team to win, but it is unknown how sustainable this is.
The Pacers benefit from having a great system with one of the best head coaches in the game. Rick Carlisle is fantastic at scheming, making adjustments, and getting the best out of his players. Additionally, Indiana's run-and-gun offensive style is not easy for just anybody to play in. They have plenty of players who buy into their role in the system, and it has worked wonders for them.
Indiana got to this point by hitting on some of their draft picks (i.e., Andrew Nembhard in the second round) and buying low on many of their key players. Outside of Pascal Siakam, just about everybody who played a big role in the Pacers' latest NBA Finals run has played the best basketball of their careers since joining the team. This includes guys like Haliburton, Aaron Nesmith, and Obi Toppin. They were able to land castaways from other teams and turn them into key players on a near-championship team.
As it stands, the Pacers are not going to be a luxury team for another year. However, that may have to change down the line. They have most of their key players under contract for multiple seasons, but at some point, they will have to make a choice. Either they can commit to their current roster and be willing to pay the luxury tax, or they can move on from some of their key players and hope to make magic once again.
Regardless, the Pacers are in a good spot, even with next year looking grim. However, if this summer was any indication, they may continue to not be a luxury team for a very long time.