The D.C. Council granted preliminary approval today to legislation increasing the marginal tax rate on high-income D.C. residents, with funds going toward higher wages for child care workers, housing vouchers for residents experiencing homelessness and a monthly payment to low-income families who qualify for the Earned Income Tax Credit.

“The working poor of our city are begging us to help them,” said Councilmember Elissa Silverman (I-At Large) in emotional remarks ahead of the vote.

The amendment was approved 8-5 in the Committee of the Whole, with opposition from Chairman Phil Mendelson and councilmembers Mary Cheh (D-Ward 3), Brooke Pinto (D-Ward 2), Kenyan McDuffie (D-Ward 5), and Anita Bonds (D- At Large).

The budget amendment brought by Councilmembers Charles Allen (D-Ward 6), Brianne Nadeau (D-Ward 1) and Janeese Lewis George (D-Ward 4) increases the city’s marginal income tax rate on residents who earn at least $250,000 a year. The legislation has been a top priority for progressive groups in the city, whose leaders have pitched the increase as a way to raise revenue for vulnerable workers and residents as they attempt to recover from the pandemic.

Raising taxes on the city’s top earners is a lightning rod within the business community, and the Federal City Council — an influential pro-business lobbying group led by former D.C. Mayor Anthony Williams — rallied employers against it. Chairman Phil Mendelson has also criticized the increase, calling it unnecessary when the city is awash in nearly $2.5 billion in federal relief funds.

“If [this] is not done carefully, almost always there are repercussions,” the chairman told his colleagues ahead of Tuesday’s first vote.

If it passes final approval, the tax hike is expected to raise up to $175 million by FY 2025. Funds will go toward paying higher wages to many early childhood educators, allocating $65 million in housing vouchers to 2,400 homeless residents, and creating a monthly basic income for low-income families who qualify for the Earned Income Tax Credit starting in 2023.

Supporters of the increase say it will raise taxes on 4% of D.C. taxpayers, with most revenue drawn from residents earning more than $1 million a year.

The proposal passed a second vote in a subsequent legislative session Tuesday. Budget legislation must undergo two more votes before it can be sent to Mayor Muriel Bowser.