The Chicago City Council begins its hearings on Mayor Brandon Johnson's 2026 budget proposal on Tuesday.

Several of Mayor Brandon Johnson's marquee budget plans faced tough questioning Tuesday, from how to tax social media to the pitfalls of taxing companies that employ a large number of people in Chicago. 

Johnson's plan avoids property tax increases by turning to other measures. 

Johnson's plan also hit businesses with a new monthly fee, which the mayor calls the "community safety surcharge." The fee is $21 per month per employee — a tax for businesses with more than 100 employees would need to pay. The mayor said approximately 97% of local businesses fitting that profile would be exempted from the tax, and it would apply only to 3% of the largest corporations.

"Do you see that as being a disincentive for employers to remain in Chicago, if they're going to be penalized for having employees here?" wondered 42nd Ward Ald. Brendan Reilly. 

The mayor's budget team cited how little changed when Mayor Rahm Emanuel removed the head tax, albeit a smaller head tax, in 2014.

"Chicago did not vary compared to the state or country when that action was taken," said Chicago CFO Jill Jaworski.

Other revenue generators under consideration include a new $2 per unit cannabinoid hemp tax and a new social media amusement tax, which would be levied on large tech companies.

The social media tax would bring in $31 million each year, but given that it's never been done anywhere else, councilmembers wanted to know if it would get held up in court.

"We feel very confident that we have the legal standing to levy that tax," Budget Director Annette Guzman said. "With any tax, especially a new tax, there is a potential likelihood that someone will challenge, but that doesn't mean the challenge will succeed."

The mayor has also proposed tripling the yacht tax rate for people mooring boats in Chicago's harbors along Lake Michigan and an increase on vacant building fees.

Some of the money raised through these taxes will be used to expand mental health services.

The part of the plan that irked alders the most? Johnson's plan to take $1 billion in Tax Increment Financing, or TIF, dollars from the control of the city council members who had plans to use it.

"You are basically taking $3.3 million from communities like Back of the Yards, Canaryville," said 15th Ward Ald. Ray Lopez.

"We follow our state laws as it relates to our TIFs that require us to sweep any unallocated or unaccounted dollars," Guzman said. 

"We just haven't done it to this extent previously," said 11th Ward Ald. Nicole Lee. "To not have had the conversations at the ward level is very off-putting, at the end of the day."

Civic Federation president Joe Ferguson said the mayor's budget leans heavily on progressive values but calls the plan "fiscally unsound."

Johnson pushed back on that analysis at CBS News Chicago on Monday, saying the budget lets the city pay into its pension obligations without placing the burden on working people or necessitating layoffs.

"We're gonna challenge the ultra-rich and our large corporations to pay their fair share in taxes," he said.

Johnson said his budget closes a fiscal gap of over $1 billion that the city is facing without raising property taxes.

With county tax bills delayed — money critical to City Hall — and Springfield chilly on Chicago, some in council are starting budget season skeptical. 

"It would help if some people in this building stopped taking shots at the leadership in Springfield," said 19th Ward Ald. Matt O'Shea. "When is the urgency going to hit?  When are we going to do things on these fronts?"

Gov. JB Pritzker said Tuesday he doesn't support the corporate head tax pitched by the mayor. 

There are 11 scheduled budget meetings between now and mid-November. The budget must be approved by the full Chicago City Council by the end of the year and needs 26 votes to pass. Last year it took until the last week of 2024 to get the budget through, and many are expecting the same this year.