Can Governor's tax plan reel in Boeing 777X for Washington?

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by Glenn Farley / KING5 News Aviation Specialist

Bio | Email | Follow: @GlennFarley

KING5.com

Posted on October 2, 2013 at 6:12 PM

Updated Wednesday, Oct 2 at 6:42 PM

EVERETT - Governor Jay Inslee says he wants to extend a 10-year-old package of tax incentives currently enjoyed by Washington's aerospace industry to 2040, if Boeing agrees to build its new 777X jet in the state.

That  set of aerospace tax incentives, that focuses on aspects of the state's Business and Occupations Tax, helped land Boeing's 787 in 2003 after it was proposed by then Governor Gary Locke. That's set of tax breaks  set to expire in 2024.

Since then a study by the Washington Aerospace Partnership finds that while the state has given up over one billion dollars in direct tax collections, proponents say the incentives have helped expand aerospace manufacturing in Washington and including increased tax collections from revenues from sales taxes made by employee purchased has raised three billion in that same period. Roughly a three to one benefit.

Because of the state Constitution, the state cannot provide a direct benefit to a specific company, which is why the breaks apply industry wide.  If Airbus built a plant in Washington it would get the same deal.  Airbus does benefit indirectly because Washington is one of the largest supplier of parts and tooling to the European based plane maker.

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