An impassioned Mayor Brandon Johnson was in his element as he tailored his pitch to reinstate Chicago’s corporate head tax during a recent West Englewood town hall.

“There’s a reason why more of our people have left this city than any other group,” Johnson told a mostly Black audience at the Nov. 1 town hall organized by his supporters. “We ought to demand the ultrarich do more, so that we can get more.”

Standing in the mayor’s way at that event was local Ald. David Moore, 17th, who said he sent out a robocall to his constituents ahead of the budget town hall to counter the pro-Johnson coalition’s presence.

“We don’t want those Black McDonald’s operators to suffer. That’s not what it’s supposed to be about,” Moore told the crowd. “I gotta deal with the little operator that’s on 76th and Vincennes who may be impacted by this negatively, then he’ll fire those kids or close down his place, and then it hurts our community.”

The tension behind Johnson’s pitch that day for a monthly $21-per-employee tax on big companies is part of a larger progressive revenue battleground where the mayor desperately needs a win. Having already failed to deliver other key tenets of his ambitious tax-the-rich wish list, the head tax is a watershed moment for Johnson and his allies.

“Look, the baseball season just ended, so it’s still fresh in mind: three strikes and you’re out,” Joe Ferguson, president of the Civic Federation watchdog group that opposes the head tax, said of Johnson’s revenue woes. “It hasn’t worked because the math hasn’t been worked out, the justification hasn’t been made beyond simply an ideologically driven critique.”

Less than a year into Johnson’s term, voters rejected the mayor’s “Bring Chicago Home” tax referendum. His Springfield strategy of pressuring Gov. JB Pritzker and state lawmakers to tax the rich has similarly faltered so far. If Johnson strikes out a third time by failing to convince City Council on the head tax, he may struggle to find a lane to pass new levies before his current term ends in 2027.

Johnson sees the ongoing resentment against Republican President Donald Trump in deep-blue Chicago as the best opening to advance his stalled progressive agenda.

But so far, the political hurdles Johnson’s facing are typically local: stubborn opposition from the business community, a looming 2027 election that makes aldermen reluctant to endorse new taxes and waning faith in the freshman mayor’s ability to carry new revenue proposals over the finish line before then.

Next door to Moore’s ward, the crowd at Ald. Desmon Yancy’s town hall — sans Johnson — vacillated from tepid clapping to groans as he went from crediting the mayor’s “wisdom” in skipping a grocery tax reinstatement to noting it “also includes a few new taxes.”

Yancy’s 5th Ward stretches from the gothic halls of the University of Chicago to the South Shore working-class communities Johnson says will benefit the most from the public safety programs his head tax would fund.

One of Yancy’s constituents, Hyde Park resident and Johnson 2023 transition team member Niketa Brar, confronted the aldermen outside the auditorium that night and argued Trump’s massive federal tax cuts for corporations make the mayor’s head tax pitch a necessity.

“When we have systemic failures, it is our responsibility to use tax revenue to solve for those failures,” she told the Tribune afterward.

But Yancy, a freshman progressive who could be a critical swing vote, remained undecided. Though he has said he’s against regressive fixes, he’s also worried the surcharge would disincentivize hiring, especially for restaurants, or lead corporations to find loopholes.

The mayor last month pitched his $21-per-employee tax on corporations as the next frontier in his progressive economic agenda.

That platform from his 2023 campaign featured about $800 million in new levies aimed at some of the city’s most powerful industry interests. Beyond the head tax, he promised a jet fuel levy and a hotel tax increase. Johnson also called for a tax on financial transactions, which the governor put the kibosh on early.

At the time, Johnson warned Chicago’s long-standing structural deficit would come home to roost for the next mayor. He was right, as the city must close a whopping $1.19 billion budget gap in 2026.

But since taking office, Johnson has had to grapple with age-old limits on what levers the mayor can pull, while buckling under his own missteps that hampered his ability to cajole or strong-arm other elected officials to go along with his wishes.

Most new taxes would need Springfield approval, but the mayor’s frosty relationship with Pritzker thus far makes that prospect slim. The head tax is a notable exception, yet Johnson finds himself fighting tooth and nail to get aldermen to support the idea for 2026.

Ishan Daya, co-director of the Johnson-allied Institute for the Public Good, turned the heat up on the governor, who is weighing a 2028 presidential bid, after Pritzker threw cold water on endorsing the head tax. “We have primaries coming up next year, and we have a governor who wants to be the president, and there needs to be a mandate … to make sure that we are taxing corporations,” Daya said.

But Jason McGrath, a Democratic consultant who worked for Johnson’s predecessor Lori Lightfoot, said voters “mad at the influence of billionaires” won’t necessarily jump to “tax these companies on the people that they hire.”

“If your big swing is something that’s pretty DOA, I don’t know what you go to afterwards,” McGrath said. “So if this is his last stand, it’s kind of pathetic.”

Johnson has acknowledged from the outset the head tax would be a tough sell, given the entrenched interests vehemently opposed to it.

Business owners with deep pockets and lobbyists have lined up against the tax in private meetings and via a full court press in op-eds to try to discredit Johnson, while warning on-the-fence aldermen that his plan will hurt job growth and push companies out of Chicago.

Meanwhile, a rebellious, but divided City Council sees little reason to genuflect to a mayor viewed as weak — though it’s unclear what aldermen can and will pitch instead to balance the budget. Johnson has argued some critics only want to score political points by dragging his proposals while avoiding the burden of coming up with clear, and likely also painful, alternative solutions.

Adding to the complications is the fact Johnson’s most ideologically aligned bloc, the Progressive Caucus, has not yet come to a consensus. One member, first-term Ald. Ruth Cruz, said she does believe “we all need to share the burden here” but questioned why the mayor has waited until his third budget for such a heavy lift so close to them all facing reelection in 2027.

“You would have thought that this would have been done in the first year. People always tell you, when you come in in your first year, you have so much leeway,” Cruz, 30th, said. “But this is our third budget already. So it’s interesting, the timing. It’s interesting, the logic behind it.”

Normally, mayors want to pass their toughest budget initiatives in the first two years and pitch their easiest-to-swallow proposals for voters in their fourth election-year budget. But Johnson rejected that he is operating on a deadline to pass progressive revenue, because the city is going through “unconventional” political times: “Donald Trump makes this moment urgent.”

A head tax of $3 and later $4 per employee was first put in by Mayor Richard J. Daley and chugged along for nearly four decades before Mayor Rahm Emanuel phased it out by 2014 as part of his administration’s pro-business agenda for downtown.

The mayor’s monthly $21-per-employee proposal would be charged on companies with more than 100 employees who work more than half their time in Chicago. Starting in 2027, the fee would go up by inflation, capped at 5%. Nonprofits would be exempt.

Some opponents are contending that the mayor’s proposal would rope in part-time workers because it defines a full-time employee as a worker accruing at least the city’s minimum wage multiplied by 455 — about $7,553 now — per quarter.

Johnson spokesman Cassio Mendoza said Friday the Law Department is reviewing the language to ensure the legislation only captures full-time employees.

The $100 million the head tax is projected to raise would go into a “Community Safety Fund” to pay for existing programs that were subsidized by federal pandemic relief money that’s set to expire. But some community violence interruption groups aren’t happy.

A coalition of street outreach groups including Chicago CRED released a statement describing the levy as a “controversial” measure and cast doubt on actually getting the proceeds, but not all antiviolence groups were as skeptical.

“We’re seeing consistent declines in our community areas when it comes to shootings and homicides, and I think that would be disrupted if this instability is forced upon these communities,” said Sheila Regan, chief operating officer of Acclivus Inc., an antiviolence organization receiving city funding.

City finance officials have said $18.6 million would go to new community violence intervention grants to outside agencies, though budget documents show that pool would fall under the Finance General fund, which the mayor’s office has much wider leeway to use as they see fit. But Johnson’s team has insisted the money would essentially be lockboxed and only spent on community safety programs.

“Look, I’m going to be very honest here, because I just think there’s nothing surreptitious about my presentation. Do I want to earmark dollars?” Johnson said about concerns of the revenue’s use during an interview with the Chicago Tribune Editorial Board. “Of course people would prefer to have something more fungible. I’m saying that I’m willing to make it very clear how these dollars are being spent.”

Other allocations include $48.9 million to sustain youth job funding, on top of smaller pools for violence interruption programs, resources for domestic violence survivors and 31 professional counseling jobs with Chicago police, documents show.

In the postmortem of Bring Chicago Home — Johnson’s failed 2024 referendum to raise the real estate transfer tax and spend it on homelessness services — supporters and critics surmised that voters did not trust City Hall to manage that revenue stream responsibly or transparently. Johnson appeared to be adjusting to that criticism this time around, while responding to questions on his Plan B by maintaining that he’s “drawing a clear line” on funding those programs at that level.

But within the Progressive Caucus, Johnson’s most ideologically aligned bloc, members haven’t yet reached consensus. Co-chair Ald. Maria Hadden isn’t surprised, she said, given that council members should be focused on making the dollars and cents add up, not ideological warfare.

But there is a fiscal case for reinstating the head tax, she said.

“At the end of the day, we have a budget to pass for the city of Chicago that must be balanced,” Hadden, 49th, said. “We have finite sources of revenue, we have a lot of known expenditures and costs, and we have a duty to serve our constituents, and none of that is ideological.”

Other new taxes in Johnson’s 2026 budget that he says would redistribute wealth to the poor include a new charge on social media tech giants that would fund mental health services by $31 million, a hike to the city’s personal property lease tax — which includes a tax on cloud software and infrastructure — from 11% to 14% to net $333 million and a $4.1 million hike to the boat mooring fee, dubbed by Johnson as a “yacht tax.”

Ald. Andre Vasquez, Hadden’s caucus co-chair, agrees with asking corporations to “pay their fair share,” but he wants the Johnson administration to engage with, not against, the business community and provide more analysis on the head tax’s impact.

“There is clearly some level of voice that wants to see it happen,” he said, pointing to last week’s election of democratic socialist Zohran Mamdani in New York City’s mayoral race. But Vasquez, who voted against Johnson’s 2025 budget, said he does not believe the tax would actually bring in $100 million.

It would cost an employer with 101 workers just shy of $25,500 annually. For larger companies that have thousands of people on their payrolls — Chase, AT&T, Walgreens, American and United Airlines, Jewel-Osco, Allstate and Aon — the head tax tab would be magnitudes higher.

These factors are all swirling around aldermen, particularly progressives, as they must decide whether to stick their necks out for Johnson in his latest attempt to tax the wealthy. But even if he fails, his progressive base will want him to persevere, reelection considerations be damned, veteran political strategist Delmarie Cobb said.

“As a progressive, he’s got to keep trying,” she said. “The bottom line for me is, you keep trying.”

_____

(Chicago Tribune’s A.D. Quig contributed reporting.)

_____

©2025 Chicago Tribune. Visit chicagotribune.com. Distributed by Tribune Content Agency, LLC.