The World Trade Organisation has ruled that Boeing has illegally benefited from billions of dollars of aid from Washington State.
Washington almost halved Boeing’s tax rate to persuade the aircraft manufacturer to build its Boeing 777 in the state, encouraging the use of domestic materials, which unfairly distorts trade.
Some estimates have put the value of the tax break at between $2 billion and $9 billion dollars. Airbus has argued that the susidies, due to continue until 2040, are worth $7 billion.
Boeing and Washington State have been told to end the subsidies within 90 days, but World Trade Organisation rulings are not legally binding.
In September, the World Trade Organisation announced Boeing’s European rival Airbus, which employs 15,000 people in the UK, had received billions of euros in illegal state subsidies.
Airbus had received low interest loans to develop its Airbus 350, a rival to Boeing’s 777, which only had to be repaid if the jet was a success.
However, the European Union has lodged an appeal against the Airbus ruling and the US government is expected to do the same on behalf of Boeing.
