San Diego, January 26, 2026
The San Diego City Council’s Rules Committee has approved a revised tax proposal for vacation rentals, increasing the annual fee to $8,000 per property. This measure will generate revenue for the city’s general fund to support vital services. The full Council is set to vote in March 2026, with potential voter consideration in June 2026. The revised proposal shifts from a per-bedroom tax to a flat fee per property, aiming for simplicity. Community reactions are mixed, with supporters praising its necessity, while critics express concerns over tourism impacts.
San Diego
San Diego City Council’s Rules Committee has advanced a revised proposal to tax certain vacation rentals, increasing the annual fee to $8,000 per property. This measure aims to generate additional revenue for the city’s general fund, which supports essential services such as police, fire protection, libraries, and parks. The proposal now focuses on a per-property tax rather than a per-bedroom tax, as initially considered. The full City Council is expected to vote on this measure in March 2026, with potential voter consideration in June 2026.
Details of the Revised Tax Proposal
The updated proposal, known as the “Empty Second Homes and Vacation Rental Tax,” seeks to impose an annual fee of $8,000 on properties that are not the owner’s primary residence and are used as short-term rentals. This adjustment aims to simplify the tax structure by applying the fee to the entire property rather than individual bedrooms. The revenue generated from this tax is intended to bolster the city’s general fund, thereby enhancing public services across San Diego.
Background and Previous Developments
In October 2025, Councilmember Sean Elo-Rivera introduced the initial version of this tax proposal, targeting second homes and short-term rentals. The original plan suggested a tax of $5,000 per bedroom, potentially generating up to $133 million annually. However, following further deliberations and feedback, the proposal has been revised to a flat fee of $8,000 per property. This change reflects a shift towards a more straightforward tax system and addresses concerns raised by property owners and industry stakeholders.
Community Response and Potential Impact
The proposed tax has elicited mixed reactions from the community. Supporters argue that it is a necessary step to ensure that property owners who profit from short-term rentals contribute fairly to the city’s services. They believe that the revenue could be instrumental in addressing housing affordability and funding essential public services. On the other hand, critics express concerns that the tax could negatively impact the tourism industry and local businesses that rely on short-term rentals. They also worry about the potential for increased costs being passed on to renters and the broader community.
Next Steps
The San Diego City Council’s Rules Committee has voted to advance the revised tax proposal, and it is now set to be reviewed by the full City Council in March 2026. If approved, the measure will be placed on the ballot for voter consideration in June 2026. The outcome of this vote will determine whether the tax will be implemented, potentially leading to significant changes in the short-term rental landscape in San Diego.
Key Features of the Revised Vacation Rental Tax Proposal
| Feature | Description |
|---|---|
| Tax Amount | Annual fee of $8,000 per property used as a short-term rental and not the owner’s primary residence. |
| Revenue Allocation | Funds directed to the city’s general fund to support services like police, fire protection, libraries, and parks. |
| Implementation Timeline | Full City Council vote anticipated in March 2026; potential voter consideration in June 2026. |
| Tax Structure | Revised from a per-bedroom tax to a flat fee per property for simplicity and clarity. |
| Community Impact | Debate over effects on tourism industry, local businesses, and housing affordability. |
Frequently Asked Questions (FAQ)
What is the revised vacation rental tax proposal in San Diego?
The revised proposal seeks to impose an annual fee of $8,000 on properties that are not the owner’s primary residence and are used as short-term rentals. The revenue generated is intended to support the city’s general fund, which finances essential services such as police, fire protection, libraries, and parks.
How does this tax differ from the original proposal?
Initially, the proposal suggested a tax of $5,000 per bedroom, potentially generating up to $133 million annually. The revised plan simplifies the tax structure by applying a flat fee of $8,000 per property, rather than per bedroom.
When will this proposal be voted on?
The full City Council is expected to vote on the revised tax measure in March 2026. If approved, it will be placed on the ballot for voter consideration in June 2026.
What are the potential impacts of this tax?
Supporters argue that the tax is necessary to ensure property owners who profit from short-term rentals contribute fairly to the city’s services. Critics express concerns that it could negatively impact the tourism industry and local businesses that rely on short-term rentals, potentially leading to increased costs for renters and the broader community.
How can I stay informed about this proposal?
Residents are encouraged to attend City Council meetings, participate in public forums, and monitor official city communications for updates on the proposal’s progress and any upcoming votes.
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Author: STAFF HERE SAN DIEGO WRITER
The SAN DIEGO STAFF WRITER represents the experienced team at HERESanDiego.com, your go-to source for actionable local news and information in San Diego, San Diego County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Comic-Con International, San Diego County Fair, and San Diego Pride Festival. Our coverage extends to key organizations like the San Diego Regional Chamber of Commerce and United Way of San Diego County, plus leading businesses in biotechnology, healthcare, and technology that power the local economy such as Qualcomm, Illumina, and Scripps Health. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
