WTO says no tax break for Boeing 777X jet

THE World Trade Organization (WTO) ruled on Monday a tax break from Washington state to help Boeing develop its new 777X jetliner was a prohibited subsidy, in a setback for the US planemaker as it eyes victory in a parallel case against Airbus.

The WTO said the subsidy came in the form of a renewed cut in Washington state’s main business tax for aerospace agreed in 2013, when Boeing was considering where to base assembly of the latest member of its long-haul jet family.

It is the third swathe of taxpayer support for Boeing or its European rival Airbus faulted by the WTO in a record transatlantic trade spat dating back 12 years, and involving mutual accusations of tens of billions of dollars of aid.

The ruling, which can be appealed by either side, comes as the US ponders the first sanctions against the European Union in more than a decade over earlier subsidy rulings against Airbus.

The WTO did not give a value for the banned aid in its latest ruling, but the EU estimated it at $US5.7 billion ($F11b) out of an $US8.7b ($F17b) tax package in Washington, where most Boeing factories are based.

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