Illinois Governor JB Pritzker assailed a plan by Chicago Mayor Brandon Johnson to bring back a tax on large corporate payrolls, saying the proposed levy would repel major employers.
“I am absolutely, four-square opposed to a head tax for the city of Chicago,” Pritzker said Tuesday at the Economic Club of Chicago. “It penalizes the very thing that we want, which is we want more employment.”
The governor’s opposition adds to the pressure on Johnson as the mayor tries to close next year’s $1.19 billion budget deficit with new or higher taxes on big corporations, tech companies and wealthy residents. Johnson’s so-called head tax, which would levy $21 per employee per month on companies with at least 100 workers, is designed to raise $100 million for community-safety programs.
Pritzker called on Johnson to cut costs as a way to balance the city’s budget. The governor himself ordered state agencies to identify ways to put 4% of their budgets into reserves, limit spending and prioritize only essential hires as he braces for the economic fallout from President Donald Trump’s policies.
“You’ve got to start with efficiencies, you’ve got to go into city government, and I haven’t seen any of that in this budget so far,” Pritzker told the audience of just under 1,000 business leaders. “I think that’s going to have to happen.”
The so-called head tax would require approval by the Chicago city council, and Pritzker can’t veto it. But he said imposing it would damage his efforts to reverse perceptions that the city and Illinois as a whole were inhospitable for business.
“We’re a state that had a bad reputation,” Pritzker said. “I came into office and I spent six and a half years trying to turn that reputation around, balance our budgets, attract businesses, create incentives for businesses, cut taxes, do everything that I could possibly do to attract new businesses, and to keep businesses here.”
His initiatives to attract new companies and help existing businesses expand have helped land more than $1 billion in investments in the state’s quantum and microelectronics park from companies such as Infleqtion, PsiQuantum, International Business Machines Corp.
Earlier this month, Pritzker’s office said Pasqal, a French quantum computing company, will establish its North American headquarters at the site, which is located on Chicago’s South Side.
“How about we do our best to attract, retain and grow businesses in the city of Chicago? Because that, again, is the best way for us to pay the bills,” Pritzker told the audience of just under 1,000 business leaders.
