Boeing was offered billions in illegal tax breaks, WTO says

U.S. plane maker Boeing received major illegal tax breaks from Washington state, a world trade body ruled Monday, adding that the federal government should now take action to end that support within months.

The Chicago-based company and the European Union, which backs Boeing’s key European rival Airbus, both claimed the ruling by the World Trade Organization as a victory in a longstanding battle for contracts between the two aerospace giants.

The WTO found that the support Washington state promised to give Boeing from 2024 to 2040 amounted to “prohibited” subsidies. The support offered by Washington came on condition that Boeing keeps the production of the wings for the wide-bodied 777X plane in the state, effectively excluding foreign competition. Boeing has extensive plants around Seattle.

The 28-member bloc said the WTO had ruled that $5.7 billion in subsidies were illegal, out of a total $8.7 billion in measures that it reviewed.

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