There are reports that Boeing is about to be hit with a claim for up to $9bn (£7.23bn) in the latest stage of a long-running battle over claims of illegal tax breaks, with indications that the World Trade Organisation (WTO) is set to find in favour of the EU which brought the latest complaint that the US aerospace manufacturer has broken state aid rules
The claim relates to an incentive Boeing was given by Washington State, which almost halved its tax rate to encourage the plane-maker to develop its new 777-X airliner there. The plane is a direct competitor to the Airbus A350.
The row over state support for aircraft industries has been going on for more than a decade, with the US backing Boeing and the EU favouring Airbus.
On its website Boeing has published a statement saying: ‘The EU in February 2015 brought another complaint to the WTO, this time on tax breaks the state of Washington recently enacted to attract new investment by aerospace companies in the state. The US government has argued that the tax breaks fully comply with WTO rules.
‘The state lowered what was one of the highest tax rates in the United States to incentive aerospace investment. The new tax rates are available to any aerospace company, including Airbus, and they will benefit Airbus suppliers already located in the state.
‘Notably, the state is not writing any checks to Boeing, which still will be paying substantial taxes to the state. This contrasts sharply with the ongoing European practice of launch aid, where governments write checks for billions of euros to Airbus.’
Airbus and Boeing declined to comment on the forthcoming WTO ruling, saying it would be ‘inappropriate’ to do so before the WTO issues its statement, which is expected within the week.
