Johnson pushes social media tax in budget plan
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Members of the progressive caucus, led by Ald. Maria Hadden, offered general support for the progressive budget plan Mayor Brandon Johnson presented Thursday. Photo: Monica Eng/Axios
A social media tax, new yacht docking fees and a renewed employee surcharge lead the list of novel revenue sources Mayor Brandon Johnson is pushing in his 2026 budget to fill a $1.15 billion hole.
The big picture: The $16.6 billion budget proposal introduced Thursday morning delivers on Johnson's promise to lean into progressive revenue from the "ultra-wealthy" while, at least for now, avoiding hikes in property taxes, garbage fees and grocery taxes.
- The progressive caucus welcomed the proposal, but it's likely to face major pushback from the business community and more conservative alders, including Brian Hopkins, who called it "dead on arrival."
- Even some progressive alders say they're leaving the option for property tax hikes on the table.
Zoom in: Here are a few key parts of the budget proposal.
Social media tax: Johnson wants tech giants to cough up 50 cents per Chicago user after the first 100,000 to fund and insulate mental health services from federal funding cuts.
- "Despite the fact that it would be very popular, I suspect there's going to be significant legal issues with that one," said Ald. Bill Conway of this first-of-its-kind tax.
Head tax: Johnson has reframed this fee as a "community safety surcharge" that taxes businesses with more than 100 workers $21 per month per employee, more than five times what it was under Mayor Rahm Emanuel, who dissolved it in 2014.
- Even alders who support reviving the tax tell Axios they think the plan would need a haircut, "to maybe bring it down to $5 or $10," Ald. Scott Waguespack tells Axios.
- But Johnson ally Ald. William Hall called it a way to "Trump-proof" the budget.
Massive TIF surplus: Johnson announced that he'd draw $1 billion from unused money in special taxing districts, with half going to Chicago Public Schools to cover, among other things, the controversial pension repayment to the city that contributed to the firing of the school superintendent.
- Many alders, including Matt Martin, said they were surprised by the $1 billion figure but said, "If we don't expect we're going to use [TIF money] in this coming year, well, then some funds need to get repurposed to pay down debt."
Yacht tax: Johnson said he would raise the fees for mooring boats in Chicago, especially on non-city residents, in a move that he estimated could raise $4.1 million a year.
- "It's such a small amount of revenue that the value is purely symbolic. It's just simply to show that this mayor doesn't like capitalism," Hopkins said.
Grocery tax: While the mayor avoided reinstating the 1% grocery tax eliminated by the state this year, Waguespack predicts it could return in the final budget.
What's more: The plan also includes expanding Chicago's amusement tax to include online sports betting and raising cloud computing fees.
The bottom line: "There's a lot of homework to do," Ald. Andre Vasquez tells Axios, "but I'd say it's a good starting point for the discussion."
What's next: The mayor and City Council have until the end of the year to agree on a final budget.