September 16, 2014

San Diego Illustrated: A Visual Guide to Taxes & the Economy

Individual images from the chartbook are available here.

Taxes are complicated. Every city and state’s tax code is a multifaceted system with many moving parts, and San Diego is no exception. This chart book, the result of collaboration between the San Diego Regional Chamber of Commerce and the Tax Foundation, aims to help readers understand San Diego’s overall economy and tax system from a broad perspective. It also provides detailed information about San Diego’s public finances as compared to other cities in order to ease the complicated task of understanding the city’s tax climate.

Over the past forty years, San Diego’s population has doubled. Although employment growth has been weaker over the same period, wages have risen above the national average for more than a decade. Furthermore, San Diego is a destination city for highly skilled labor.

In terms of government finance, San Diego performs well. Not only does the city have a smaller government than those of competitor cities, it also has low spending and very low debt. Taxes per capita have also decreased in recent years. However, San Diego relies less on local property and sales taxes, which means it must lean more on distortionary business and excise taxes.

Despite these local successes, California continues to be a drag on San Diego’s economic performance. Taxes in the state are high and poorly structured. Tax burdens and rates alike have risen over time. The general tax climate is a deterrent for businesses. In sum, California’s tax code makes it hard for San Diego to compete.

Each piece of San Diego’s economic climate tells a story. While taxes are complicated, we hope this book will help put those dynamic pieces together to provide an in-depth picture of San Diego’s tax climate. Our hope is that this resource for Chamber members, business owners, policymakers, and the general public will inform ways to improve the tax system and improve San Diego’s business climate.

These charts were developed by San Diego Regional Chamber and Tax Foundation staff and edited by economist Lyman Stone. We thank the County of San Diego for their investment in this invaluable resource for San Diego job creators.

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