Seattle is not alone. Other big cities have had their own head tax battles.

Jared Walczak, a senior policy analyst with the Tax Foundation, points to two cities with different head tax experiences as examples.

"Chicago had a head tax for years," said Walczak.

The city implemented a head tax in 1973. Mayor Rahm Emanuel pushed for a repeal of the head tax which required businesses with more than 50 employees to pay $48 per employee a year.

"The head tax is a job killer," said Emanuel, and in 2014 it was eliminated.

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But in Denver, it continues. If employees earn at least $500 a month, their employers end up paying $48 per employee a year.

What's proposed in Seattle is more than ten times that amount. If enacted, the top 3 percent of Seattle businesses would pay $500 per employee a year. The money would go toward affordable housing and homeless services.

WATCH: Outlining Seattle’s proposed employee head tax

"The head tax is a poorly devised tax. You don't want to tax something that you want to encourage, like job creation," said Walczak.

The D.C. senior policy analyst says it is a bad idea, and at City Hall Wednesday during a special meeting, some agreed.

One man told city council members, "Businesses can vote with their feet. They can move their jobs anywhere they want."

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A supporter of the head tax proposal stood up and said, "I urge the affluent to own up to the problems they have helped create to support our neighbors who are living on the streets."