Changing Gears

Last month, we told you about Chicago Mayor Rahm Emanuel’s proposal to eliminate the city’s “head tax” on businesses with 50 or more people. Now, city council has made it official.

Aldermen voted today to cut the tax in half by next July, and eliminate it by mid-2014, according to the Chicago Tribune.

The city charges a tax of $4 per person per month at companies that fall under the definition. The tax generates about $23 million a year in revenue.

Emanuel’s budget plan calls for a number of ways to make up the shortfall, including raising taxes at downtown parking garages and hotels.

“The head tax is a job killer,” Emanuel said in a statement after the vote. He had vowed to win a repeal of the tax during his campaign for mayor earlier this year. Said the mayor: “Eliminating the head tax is the right thing to do for businesses big and small, and it’s the right thing to do to secure Chicago’s future.”